DEF 14A 1 citi3503291-def14a.htm DEFINITIVE PROXY STATEMENT

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.            )
 
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[   ]   Soliciting Material Pursuant to §240.14a-12

  Citigroup Inc.  
  (Name of Registrant as Specified In Its Charter)  
 
       
 
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2019 Citigroup Inc.
Notice of Annual Meeting
and Proxy Statement
          



April 16, 2019


Annual Meeting Location:
Citi’s Headquarters
388 Greenwich Street
New York, New York 10013



 


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Citigroup Inc.
388 Greenwich Street
New York, New York 10013

 

 

March 6, 2019

 

Dear Shareholder:

We cordially invite you to attend Citi’s 2019 Annual Meeting. The Annual Meeting will be held on Tuesday, April 16, 2019, at 9:00 a.m. at Citi’s Headquarters, 388 Greenwich Street, New York, New York 10013. Directions to the Annual Meeting location are provided in the Proxy Statement.

At the Annual Meeting, shareholders will vote on a number of important matters. Please take the time to carefully read each of the proposals described in the Proxy Statement.

Although I have served as a Citi Director for over a year, and represented the Board as independent counsel for the two prior years, the 2019 Annual Meeting will be my first as your Chair. I am deeply honored to assume this new role, and deeply grateful that my predecessor, Mike O’Neill, provided such a sterling example for me to emulate in the years ahead.

Thank you for your support of Citi.


Sincerely,
John C. Dugan
Chair of the Board



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Letter from the Board
of Directors to our
Shareholders


The Board and our Risk Committee engage deeply in the oversight of risk management practices ….always recognizing that, while Citi is in the business of taking risk, these risks must be understood, measured, monitored, and controlled.

By most financial measures, 2018 for Citi was a year captured best by the phrase “steady progress.” Consistent with the goals set forth in our Investor Day presentation almost two years ago, and adjusting for the one-time impact of U.S. Tax Reform, the firm increased its net income by 14 percent; increased its earnings per share by 25 percent; reduced operating expenses by one percent, driving down the operating efficiency ratio to 57 percent; generated continued growth in loans and deposits; and perhaps most important, increased its return on tangible common equity (RoTCE) to 10.9 percent. While the lower effective tax rate resulting from U.S. Tax Reform contributed substantially to these results, Citi’s pre-tax earnings also increased modestly from the prior year.

Despite this positive operating performance, Citi’s Total Shareholder Return (TSR) for 2018 disappointed, both absolutely and relative to peers. This was partly due to a general decline in bank share prices, exacerbated by an especially sharp decrease in December for banks with substantial market-making operations. While Citi’s share price and relative TSR rebounded in the first part of this year, your Board remains very focused on Citi improving its TSR in 2019 and the years ahead – and we believe the best way for the firm to do this is to continue its steady progress, especially through improvement of its return on tangible common equity.

Management also made progress on the regulatory front last year, which we believe is critical to the firm’s success. Citi again achieved a successful result in the Federal Reserve’s annual Comprehensive Capital Analysis and Review (CCAR) stress test, enabling the return of over $18 billion of capital to common shareholders during the calendar year, while maintaining levels of regulatory capital well in excess of minimum requirements. In addition, Citi made headway on a range of heightened regulatory requirements that all large banks have faced in the wake of the financial crisis. Nevertheless, your Board will continue to pay close attention to – and expect management to make continued progress on – regulatory matters in 2019 and beyond.

As it should be for a global firm like Citi, prudent risk management was top of mind for both management and the Board in 2018. Our three lines of defense – the business lines, the control functions, and internal audit – dove deeply and, where necessary, took proactive steps in critical risk areas such as Brexit, the potential fall-out from trade wars, evolving industry underwriting standards in leveraged lending, and the potential turn of the credit cycle. Cyber risk remains a crucial priority, and the firm has invested heavily to maintain state-of-the-art defenses and cyber resilience. The Board and our Risk Committee engage deeply in the oversight of risk management practices in these and other areas, always recognizing that, while Citi is in the business of taking risk, these risks must be understood, measured, monitored, and controlled.

Much has been written about the ethical lapses that have damaged the reputation of the banking industry, including Citi, both during and after the financial crisis. We continue to believe that strong ethical standards and practices are critically important, which is why Citi, alone in the banking industry, maintains an Ethics and Culture Committee of the Board as one means to keep management striving to achieve best practices – not just at senior levels but throughout the organization.

 


Citi 2019 Proxy Statement


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Citi also took firm stands in 2018 on several issues of real importance. On diversity and inclusion, we became the first financial services company to voluntarily disclose adjusted pay gaps between women and men in the United States, the U.K., and Germany, and between minorities and non-minorities in the U.S. – and then took concrete steps to eliminate those gaps. In response to the epidemic of gun violence in the U.S., we were the first bank to announce a Commercial Firearms Policy, which requires our retail sector clients to establish such best practices as background checks and age restrictions. And in our Sustainable Progress Initiative, the firm recorded $38.4 billion in transactions toward our 10-year, $100 billion Environmental Finance goal. The Board fully supported each of these measures.

Finally, at our annual review of strategy, which we conduct each year at our July meeting, we will examine closely management’s plans to continue Citi’s path forward to achieve increased sustainable returns; address challenges from potential disruptors; improve our operations and technology; increase our efficiency; and continue to prudently manage risk. Our focus: continued steady progress toward Citi’s longer-term goal of a 16% RoTCE.

Thank you for your ongoing support of Citi. Dialogue with shareholders is a fundamental feature of a well governed organization, and we will continue to make it a priority. Please write with any concerns or suggestions to: Citigroup Inc. Board of Directors, c/o Rohan Weerasinghe, General Counsel and Corporate Secretary, 388 Greenwich Street, New York, NY 10013.

             
Michael L. Corbat
Ellen M. Costello
John C. Dugan
Duncan P. Hennes
Peter B. Henry
Franz B. Humer
  S. Leslie Ireland
Lew W. (Jay) Jacobs, IV
Renée J. James
Eugene M. McQuade
Gary M. Reiner
Anthony M. Santomero
  Diana L. Taylor
James S. Turley
Deborah C. Wright
Ernesto Zedillo Ponce de Leon
 
A WORD OF APPRECIATION
   
Mike O’Neill, who retired in January, was a director for 10 years and Chairman of our Board for seven years. He was an outstanding leader who provided wise and effective oversight, and he assembled a diverse and talented Board. In addition, Franz Humer and Tony Santomero have reached our mandatory retirement age; each provided many important contributions to the Board. Thank you – from all of us – for your valuable perspectives and years of service to Citi.

www.citigroup.com


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Notice of Annual Meeting of Stockholders


Citigroup Inc.
388 Greenwich Street
New York, New York 10013

Dear Stockholder:

Citi’s Annual Stockholders’ Meeting will be held on Tuesday, April 16, 2019, at 9:00 a.m. at Citi’s Headquarters, 388 Greenwich Street, New York, New York. Directions to the 2019 Annual Meeting location are provided on page 126 of this Proxy Statement. You will need an admission ticket or proof of ownership of Citi stock to enter the meeting. Live audio of the Annual Meeting will be webcast at www.citigroup.com.

At the meeting, stockholders will be asked to:

1. elect the directors listed in this proxy statement,
2. ratify the selection of Citi’s independent registered public accounting firm for 2019,
3. consider an advisory vote to approve Citi’s 2018 executive compensation,
4. approve the Citigroup 2019 Stock Incentive Plan,
5. act on certain stockholder proposals, and
6. consider any other business properly brought before the meeting, or any adjournment or postponement thereof, by or at the direction of the Board of Directors.

Citi has utilized the Securities and Exchange Commission rule allowing companies to furnish proxy materials to its stockholders over the Internet. This process allows us to expedite our stockholders’ receipt of proxy materials, lower the costs of distribution, and reduce the environmental impact of our 2019 Annual Meeting.

In accordance with this rule, on or about March 6, 2019, we sent to those current stockholders who were stockholders at the close of business on February 19, 2019, a notice of the 2019 Annual Meeting containing a Notice of Internet Availability of Proxy Materials (Notice). The Notice contains instructions on how to access our Proxy Statement and Annual Report and vote online. If you received a Notice and would like to receive a printed copy of our proxy materials from us instead of downloading a printable version from the Internet, please follow the instructions for requesting such materials included in the Notice.

By order of the Board of Directors,


Rohan Weerasinghe
Corporate Secretary
March 6, 2019

www.citigroup.com


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  9

Contents

PROXY STATEMENT HIGHLIGHTS 10
ENVIRONMENTAL, SOCIAL AND
GOVERNANCE (ESG) HIGHLIGHTS
13
ABOUT THE 2019 ANNUAL MEETING 16
CORPORATE GOVERNANCE 22
Corporate Governance Materials
Available on Citi’s Website
23
Annual Report 23
Corporate Governance Guidelines 23
Director Independence 25
Meetings of the Board of Directors
and Committees
29
Meetings of Non-Management Directors 29
Board Leadership Structure 29
Board Diversity 30
Director Education Program 30
Board Self-Assessment Process 31
Board’s Role in Risk Oversight 31
Committees of the Board of Directors 32
Involvement in Certain Legal Proceedings 38
Certain Transactions and Relationships,
Compensation Committee Interlocks,
and Insider Participation
38
Indebtedness 40
Business Practices Committees 40
Ethics and Culture 40
Code of Ethics for Financial Professionals 41
Ethics Hotline 41
Code of Conduct 42
Communications with the Board 42
STOCK OWNERSHIP 43
SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
45
PROPOSAL 1: ELECTION OF DIRECTORS 45
Director Criteria and Nomination Process 45
Director Qualifications 46
The Nominees 50
Directors’ Compensation 65
AUDIT COMMITTEE REPORT 69
PROPOSAL 2: RATIFICATION OF SELECTION
OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
70
PROPOSAL 3: ADVISORY VOTE TO APPROVE
CITI’S 2018 EXECUTIVE COMPENSATION
72
Compensation Discussion and Analysis 72
The Personnel and Compensation
Committee Report
98
2018 Summary Compensation Table and
Compensation Information
99
Management Analysis of Potential Adverse
Effects of Compensation Plans
107
CEO Pay Ratio 108
PROPOSAL 4: APPROVAL OF THE
CITIGROUP 2019 STOCK INCENTIVE PLAN
110
STOCKHOLDER PROPOSALS 119
Submission of Future Stockholder Proposals 125
Cost of Annual Meeting and Proxy Solicitation 125
Householding 125
Directions to 2019 Annual Meeting Location 126
ANNEX A 127
Additional Information Regarding Proposal 3 127
Glossary 127
Citigroup — Quantitative Scorecard
Metric Details and Adjusted
Results Reconciliations
128
ANNEX B 130
The Citigroup 2019 Stock Incentive Plan 130

www.citigroup.com


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10  

Proxy Statement Highlights

Voting Items
Proposal 1: Election of Directors (Pages 45-64)
The Board recommends you vote
FOR each nominee

Proposal 2: Ratification of Selection of Independent Registered Public Accounting Firm (Pages 70-71)
The Board recommends you vote
FOR this proposal

Proposal 3: Advisory Vote to Approve Citi’s 2018 Executive Compensation (Pages 72-109)
The Board recommends you vote
FOR this proposal

Proposal 4: Approve the Citigroup 2019 Stock Incentive Plan (Pages 110-118)
The Board recommends you vote
FOR this proposal

Stockholder Proposals 5-7 (Pages 119-124)
The Board recommends you vote AGAINST the stockholder proposals


Meeting and Voting Information
Date and Time
April 16, 2019, 9:00 a.m.
   

Place
Citi’s Headquarters 388 Greenwich Street New York, NY 10013

   

Record Date
February 19, 2019

   

Voting
Stockholders as of the record date are entitled to vote. Each share of common stock is entitled to one vote for each Director nominee and one vote for each of the other proposals to be voted on.

   

Admission
*New Procedures*
An admission ticket or proof of ownership of Citi’s stock is required to enter Citi’s Annual Meeting. To attend Citi’s 2019 Annual Meeting, go to the “Register for Meeting” link at www.proxyvote.com.

Board and Corporate Governance Highlights

Summary of Director Nominees
The nominees for the Board of Directors each have the qualifications and experience to approve and guide Citi’s strategy. The Board also oversees management’s execution of that strategic vision. Citi’s Board of Directors consists of individuals with the skills and backgrounds necessary to oversee Citi’s efforts on delivering sustainable, client-led revenue growth while operating within a complex financial and regulatory environment.

Independence
87% of our Board Nominees are Independent.
   
Board Refreshment

The average board tenure of our sitting nominees is 5 years and no sitting nominee has served for more than 10 years. There have been 8 new Directors elected within the last 5 years and this year’s slate includes a new nominee.

   
Diversity
Citi’s Board is committed to ensuring that it is composed of individuals whose backgrounds reflect the diversity represented by our employees, customers, and stakeholders.


Citi 2019 Proxy Statement



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PROXY STATEMENT HIGHLIGHTS 11

Director Nominees

Citi Committee Memberships*
Name and
Primary Qualifications
      Age       Director
Since
      Principal Occupation and Other Current
Public Company Directorships
      A EC E NGP OT PC RM
Michael L. Corbat
58 2012 Chief Executive Officer, Citigroup Inc.
Ellen M. Costello
64 2016 Former President and CEO, BMO Financial Corporation, and Former U. S. Country Head, BMO Financial Group
Board: Diebold Nixdorf, Inc.
Barbara J. Desoer
66 CEO, Citibank, N. A.**
Board: DaVita Inc.
John C. Dugan
63 2017 Chair, Citigroup Inc.
Duncan P. Hennes
62 2013 Co-Founder and Partner, Atrevida Partners, LLC
Board: RenaissanceRe Holdings Ltd.
Peter B. Henry
49 2015 Dean Emeritus and W. R. Berkley Professor of Economics and Finance, New York University, Leonard N. Stern School of Business
Board: Nike, Inc.
S. Leslie Ireland
59 2017 Former Assistant Secretary for Intelligence and Analysis, U.S. Department of the Treasury, and National Intelligence Manager for Threat Finance, Office of the Director of National Intelligence
Lew W. (Jay) Jacobs, IV
48 2018 Former President and Managing Director, Pacific Investment Management Company LLC (PIMCO)
Renée J. James
54 2016 Chair and CEO, Ampere Computing, and Operating Executive, The Carlyle Group
Boards: Oracle Corporation, Sabre Corporation, and Vodafone Group Plc
Eugene M. McQuade
70 2015 Former Vice Chairman, Citigroup Inc. and Former CEO, Citibank, N. A.
Gary M. Reiner
64 2013 Operating Partner, General Atlantic LLC
Boards: Hewlett Packard Enterprise Company and Box Inc.
Diana L. Taylor
64 2009 Former Superintendent of Banks, State of New York
Boards: Brookfield Asset Management and Sotheby’s
James S. Turley
63 2013 Former Chairman and CEO, Ernst & Young
Boards: Emerson Electric Co., Intrexon Corporation, and Northrop Grumman Corporation
Deborah C. Wright
61 2017 Managing Director of U.S. Jobs and Economic Opportunity, Rockefeller Foundation
Ernesto Zedillo
  Ponce de Leon
67 2010 Director, Center for the Study of Globalization and Professor in the Field of International Economics and Politics, Yale University
Boards: Alcoa Corp. and Procter & Gamble Company
* Mr. Santomero will be retiring from the Board on April 1, 2019 and Mr. Humer will be retiring from the Board on April 16, 2019, both having reached the mandatory retirement age. Mr. Humer currently serves as the Chair of the Ethics and Culture Committee and Mr. Santomero serves as the Chair of the Risk Management Committee. The Board will appoint new Chairs for these Committees effective upon their retirements.
** Ms. Desoer will retire as CEO of Citibank, N.A. before the Annual Meeting.

Qualifications
Compensation International Business or Economics
Consumer Business and Financial Services Legal Matters
Corporate Affairs Operations and Technology
Corporate Governance Regulatory and Compliance
Financial Reporting Risk Management
Institutional Business
committee member
committee chair
A Audit
EC Ethics and Culture
E Executive
NGP      Nomination, Governance and Public Affairs
OT Operations and Technology
PC Personnel and Compensation
RM Risk Management


www.citigroup.com



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12 PROXY STATEMENT HIGHLIGHTS

Corporate Governance Highlights

Citi is active in ensuring its governance practices are at the leading edge of best practices. Highlights include:

Alignment with Stockholders       Compensation Governance       Adherence to Corporate
Governance Best Practices
In January 2019, the Board of Directors lowered the threshold for stockholders to call a Special Meeting from 25% to 20%
Citi adopted Proxy Access granting eligible stockholders the right to include stockholder Board nominees in the Company’s proxy materials
Stockholders have the right to act by written consent
Citi has an independent Chair
If there is no independent Chair of the Board, the Board will appoint a Lead Independent Director
Majority vote standard for uncontested Director elections
No super-majority vote provisions in our governing instruments
Emphasize pay-for-performance alignment
Majority of total compensation based on performance
The Personnel and Compensation Committee retains an independent compensation consultant
Clawback policies for employees
Executive officers and Directors are required to retain at least 75% of the equity awarded to them as incentive compensation as long as they serve as executive officers or Directors, respectively; executive officers are required to retain 50% of such equity awards for one year following the termination of their employment
Citi was the first financial institution to publicly release the results of a pay equity review comparing compensation of women to men, and U.S. minorities to U.S. non-minorities
In 2019, Citi was the first financial institution to publicly disclose our unadjusted or “raw” pay gap for women and U.S. minorities; see page 76 of this Proxy Statement for further information
Ethics and Culture Committee of the Board
Meaningful Political Activities Statement and disclosure of Citi’s political contributions on Citi’s website
Links on our website to federal and state government websites where Citi’s lobbying activities are reported
Names of significant trade and business associations, in which Citi is a participant, posted on Citi’s website
Members of Citi’s Board of Directors and Citi’s executive officers are not permitted to hedge their Citi securities or to pledge their Citi securities as collateral for a loan
Citi’s Nominees for Director include six women and three minorities
Ongoing Board refreshment, with new independent Directors added in 2015, 2016, 2017 and 2018 and a new nominee included on the slate for the 2019 Annual Meeting
All of Citi’s nominees have served fewer than 10 years

Citi 2019 Proxy Statement



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ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) HIGHLIGHTS 13

Our Investor Engagement Program*

Summer
Members of senior management conduct follow-up calls with investors regarding votes at the Annual Meeting and other governance issues.
Fall
Members of the Board and senior management conduct calls with investors for input on a variety of governance, compensation, and environmental and social matters, including climate risk.
Winter
Senior management continues to conduct engagement calls with investors regarding governance, compensation, and environmental and social matters. The Board reviews shareholder feedback from these conversations.
Spring
Members of the Board and senior management conduct conversations with our institutional investors in advance of the Annual Meeting to provide an opportunity for discussion of compensation, management and stockholder proposals, and other governance and annual meeting matters.

Annual Stockholders’ Meeting


*

In the period following the 2018 Annual Meeting and prior to the issuance of the 2019 Proxy Statement, Citi engaged with investors regarding, among other topics, the following: executive compensation, climate change risk and disclosure including our work in response to the Taskforce on Climate-related Financial Disclosures (TCFD) Recommendations, gender pay equity, human and indigenous peoples’ rights, diversity and inclusion, board refreshment and governance, and certain stockholder proposals. For information about our engagement efforts in advance of the 2019 Annual Meeting, please see page 75 in this Proxy Statement.

Environmental, Social and
Governance (ESG) Highlights

Citizenship and Sustainability Governance at Citi

Three Board-level committees have oversight responsibility for citizenship and sustainability-related activities and report to the full Board on these topics. Management organizations provide strategic guidance and senior-level review on citizenship and sustainability topics.

Board of Directors Senior Management
 
Nomination,
Governance and Public
Affairs Committee
    Ethics and Culture
 Committee
    Risk Management
Committee
   
Environmental and Social Advisory Council
Citizenship, Corporate Sustainability, and Environmental and Social Risk Management teams
Business Practices Committees
 
Oversees citizenship and sustainability programs and company policies and procedures that impact citizenship and sustainability, including climate change, human rights and other issues; reviews engagement with major external stakeholders; and provides oversight of business practices Oversees senior management’s efforts to reinforce and enhance a culture of ethics throughout the firm Reviews Citi’s risk appetite framework, including reputational risk appetite, and reviews and approves key risk policies, including those focused on environmental and social risk

www.citigroup.com



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14 ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) HIGHLIGHTS

Sustainability Framework

Our Sustainable Progress Strategy focuses on Climate Change, Sustainable Cities, and People and Communities, with our sustainability activities organized under three primary pillars:

Environmental
Finance
     Environmental &
Social Risk
Management (ESRM)
     Operations &
Supply Chain
$100 Billion Environmental Finance Goal focused on financing environmental and climate solutions Collaborating with our clients to manage environmental and social risks and impacts associated with financed client activities Managing our global facilities and supply chain to minimize direct impact, reduce costs, and reflect best practices

Sustainable Progress Performance Highlights — 2018

Financed and facilitated
$38.4B
toward our $100 BILLION
ENVIRONMENTAL FINANCE
GOAL ($95.3B from 2014-2018)

     

Formalized a new COAL-FIRED
POWER POLICY to restrict
financing for the construction
or expansion of coal-fired power plants*

     

Reached 62% of our
goal of
100% RENEWABLE
ENERGY for our global
facilities by 2020

     

Issued INAUGURAL
GREEN BOND
,
a €1 BILLION 3-year fixed rate
notes offering (2019)

Instituted U.S. COMMERCIAL
FIREARMS POLICY
requiring
retail sector clients and partners
to adhere to responsible
sales practices*

Achieved 2020 OPERATIONAL
FOOTPRINT GOALS
for ENERGY,
WASTE and WATER reduction


Implementing the TCFD Recommendations
Citi continues to support the Paris Agreement and was an early supporter of the Task Force on Climate-related Financial Disclosures (TCFD), which promotes greater understanding of climate-related risks and opportunities through better climate disclosures. Our adoption of the TCFD Recommendations builds on over two decades of work promoting sustainability. Climate change is a central focus of Citi’s Sustainable Progress Strategy and we take action through strong governance, environmental financing, integration of climate risks into environmental and social risk management, and transparent reporting on climate-related metrics and targets.

To pilot climate scenario analysis, Citi worked jointly with 15 other banks and the UN Environment Finance Initiative to develop new methodologies and tools for the assessment of transition and physical risks and opportunities within banks’ lending portfolios. Citi piloted the transition risk methodology on our North American oil and gas exploration and production portfolio and the transition and physical risk methodologies on our U.S. utilities portfolio. We shared our process and findings in our first climate disclosure report, Finance for a Climate-Resilient Future, published in November 2018. By voluntarily adopting the TCFD framework, Citi is working to better understand our own climate risks and help navigate the transition to a low-carbon economy.


ESG Ratings

CDP Climate score of A- (Leadership Band), Supply Chain score of A
Sustainalytics overall score of 69 (79th percentile), Environmental score 87 (Leader)
MSCI score of BB
Inclusion in DJSI World and North America indices since 2001

*

For more information about our environmental and social policies, please see Citi’s Environmental and Social Policy Framework at https://www.citigroup.com/citi/sustainability/data/Environmental-and-Social-Policy-Framework.pdf.

Citi 2019 Proxy Statement



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ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) HIGHLIGHTS 15

Citizenship Approach

Executing a business model that adds value to society

     

Taking a stand on issues that matter and driving solutions

     

Reporting transparently and learning through dialogue

 

Maintaining a focus on ethical decision making and responsible business practices

      

Catalyzing innovation through strategic philanthropy and employee engagement


Citizenship Performance Highlights – 2018

                 

Provided more than
$6 BILLION in loans for
AFFORDABLE HOUSING
PROJECTS in the U.S.

Citi CHARITABLE GIVING
TOTALS $76 MILLION
in support of local communities
around the globe

First in the industry to
DISCLOSE A GENDER
PAY GAP
among global
workforce; see page 76 of this
Proxy Statement for further
information

     
 

Engaged 100,000 CITI
VOLUNTEERS
in projects in
more than 450 cities across
90 countries as part of annual
day of service,
GLOBAL
COMMUNITY DAY

Citi Foundation invested
$78 MILLION, including
$49 MILLION globally to
tackle youth unemployment
through
PATHWAYS TO
PROGRESS initiative

Set REPRESENTATION
GOALS
for Black talent in
the U.S. and female talent globally
to increase representation
ACROSS ALL LEVELS OF
THE FIRM by 2021


Recognition

World’s Best Bank for Corporate Responsibility - Euromoney Awards for Excellence 2018
Most Innovative Investment Bank for CSR - The Banker Investment Banking Awards 2018
Civic 50 - Recognized as one of the most community-minded companies in the U.S.
2018 Organizational Climate Leadership Award - Climate Leadership Conference
100% Score: Corporate Equality Index - Human Rights Campaign
2018 Bloomberg Gender-Equality Index

The UN Sustainable Development Goals: Citi Priorities

The United Nations Sustainable Development Goals (SDGs) are a set of 17 global development goals for 2030. While our activities have an impact on all of the goals, Citi is focused on seven SDGs where our core business and key initiatives can have the greatest impact. We highlight those efforts in our external reporting, including in our annual Global Citizenship Report and in a standalone report, entitled Banking on 2030: Citi & the Sustainable Development Goals.

                          

                 

www.citigroup.com



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16

About the 2019 Annual Meeting

Q: Who is soliciting my vote?
A: The Board of Directors of Citigroup Inc. is soliciting your vote at the 2019 Annual Meeting of Citi’s stockholders.
   
Q: Where and when will the 2019 Annual Meeting take place?
A: The Annual Meeting is scheduled to begin at 9:00 a.m. on April 16, 2019 at Citi’s Headquarters, 388 Greenwich Street, New York, New York. Directions to the 2019 Annual Meeting location are provided on page 126 of this Proxy Statement. Live audio of the 2019 Annual Meeting will be webcast at www.citigroup.com.
   
Q: Why did I receive a one-page Notice in the mail regarding the Internet availability of proxy materials this year instead of a full set of proxy materials?
A: Pursuant to rules adopted by the Securities and Exchange Commission (SEC), we have elected to mail to many of our stockholders a Notice of Internet Availability of the Proxy Materials (Notice) instead of a paper copy of the proxy materials. All stockholders receiving the Notice will have the ability to access the proxy materials over the Internet and receive a paper copy of the proxy materials by mail on request. Instructions on how to access the proxy materials over the Internet or to request a paper copy may be found in the Notice. In addition, the Notice contains instructions on how you may access proxy materials in printed form by mail or electronically on an ongoing basis. This process has allowed us to expedite our stockholders’ receipt of proxy materials, lower the costs of distribution, and reduce the environmental impact of our 2019 Annual Meeting.
   
Q: Why didn’t I receive a Notice in the mail about the Internet availability of the proxy materials?
A: We are providing some of our stockholders, including stockholders who have previously asked to receive paper copies of the proxy materials and some of our stockholders who are living outside of the United States, with paper copies of the proxy materials instead of a Notice. In addition, we are providing a Notice by e-mail to those stockholders who have previously elected delivery of the proxy materials electronically. Those stockholders should have received an e-mail containing a link to the website where those materials are available and a link to the proxy voting website.
   
Q: How can I access Citi’s proxy materials and Annual Report electronically?
A:

This Proxy Statement and the 2018 Annual Report are available on Citi’s website at www.citigroup.com. Click on “About Us,” then “Corporate Governance.” Most stockholders can elect not to receive paper copies of future Proxy Statements and Annual Reports and can instead view those documents on the Internet. Information on or connected to our website (or the website of any third party) referenced in this Proxy Statement is in addition to and not a part of or incorporated by reference into this Proxy Statement.

If you are a stockholder of record, you can choose this option and save Citi the cost of producing and mailing these documents by following the instructions provided when you vote over the Internet. If you hold your Citi stock through a bank, broker, or other holder of record, please refer to the information provided by that entity for instructions on how to elect not to receive paper copies of future Proxy Statements and Annual Reports.

If you choose not to receive paper copies of future Proxy Statements and Annual Reports, you will receive an e-mail message next year containing the Internet address to use to access Citi’s Proxy Statement and Annual Report. Your choice will remain in effect until you tell us otherwise or until your consent is deemed to be revoked under applicable law. You do not have to elect Internet access each year. To view, cancel, or change your enrollment profile, please go to www.InvestorDelivery.com.

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ABOUT THE 2019 ANNUAL MEETING 17

Q: What will I be voting on?
A:
Election of Directors (see pages 45-64).
Ratification of KPMG as Citi’s independent registered public accounting firm for 2019 (see pages 70-71).
An advisory vote to approve Citi’s 2018 executive compensation (see pages 72-109).
Approve the Citigroup 2019 Stock Incentive Plan (see pages 110-118).
Three stockholder proposals (see pages 119-124).

An agenda will be distributed at the meeting.

Q: How many votes do I have?
A: You will have one vote for every share of Citi common stock you owned on February 19, 2019 (the record date).
Q: How many votes can be cast by all stockholders?
A: 2,340,491,298, consisting of one vote for each of Citi’s shares of common stock that were outstanding on the record date. There is no cumulative voting.
Q: How many votes must be present to hold the meeting?
A: To constitute a quorum to transact business at the 2019 Annual Meeting, the holders of a majority of the votes that can be cast, or 1,170,245,650 shares, must be present or represented by proxy at the Annual Meeting. We urge you to vote by proxy even if you plan to attend the Annual Meeting, so that we will know as soon as possible that enough votes will be present for us to hold the Annual Meeting. Persons voting by proxy will be deemed present at the meeting even if they abstain from voting on any or all of the proposals presented for stockholder action. Shares held by brokers who vote such shares on any proposal will be counted as present for purposes of establishing a quorum, and shares treated as broker non-votes for one or more proposals will nevertheless be deemed present for purposes of constituting a quorum for the Annual Meeting.
Q: Does any single stockholder control 5% or more of any class of Citi’s voting stock?
A:

Yes, there are two stockholders that each control more than 5%. According to a Schedule 13G Information Statement filed by BlackRock, Inc. and certain subsidiaries (BlackRock) on February 11, 2019, BlackRock may be deemed to beneficially own 7.1% of Citi’s common stock. According to a Schedule 13G Information Statement filed by The Vanguard Group, Inc. (Vanguard) on February 11, 2019, Vanguard may be deemed to beneficially own 7.33% of Citi’s common stock.

For further information, see Stock Ownership — Owners of More than 5% of Citi Common Stock on page 44 in this Proxy Statement.

Q: How do I vote?
A: You can vote by proxy whether or not you attend the Annual Meeting. To vote by proxy, stockholders have a choice of voting over the Internet, by QR code, by phone, or by using a traditional proxy card by mail or in person.

Vote by Internet
Go to www.proxyvote.com. You will need the 16-digit number included in your proxy card, voter instruction form, or Notice.
         Vote by QR code
You can scan this QR code to vote your proxy card. You will need the 16-digit number included in your proxy card, voter instruction form, or Notice.
         Vote by Phone
Call the number on your proxy card or the number on your voter instruction form. You will need the 16-digit number included in your proxy card, voter instruction form, or Notice.
         Vote by Mail
Send the completed and signed proxy card or voter instruction form to the address on your proxy card or voter instruction form.
         Vote in Person
See the instructions below regarding attendance at the Annual Meeting.
        
         

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18 ABOUT THE 2019 ANNUAL MEETING

 

To reduce our administrative and postage costs, we ask that you vote using the Internet, by telephone, by mobile phone, or by QR code, all of which are available 24 hours a day. To ensure that your vote is counted, please remember to submit your vote by 11:59 p.m. ET on April 15, 2019. If you hold your shares in a Citi employee benefit plan, please submit your vote by the date indicated on your proxy card.

If you are a record holder of Citi common stock, you may attend the 2019 Annual Meeting and vote in person. If you want to vote in person at the Annual Meeting, and you hold your Citi common stock through a securities broker (that is, in “street name”), you must obtain a proxy from your broker and bring that proxy to the Annual Meeting.

   
Q: How do I get a printed proxy card?
A: If you received a Notice instead of the printed materials, there are three ways for stockholders to request a proxy card and a full set of materials at no charge. In all three examples you will need the 16-digit Control Number printed on the Notice.
   
Requesting a proxy card
By telephone: 1-800-579-1639;
By Internet: www.proxyvote.com; or
By e-mail: sendmaterial@proxyvote.com (send a blank e-mail with the 16-digit Control Number in the subject line).

Q: Can I change my vote?
A: Yes. Just send in a new proxy card or voter instruction form with a later date, cast a new vote by telephone or Internet, or send a written notice of revocation to Citi’s Corporate Secretary, Rohan Weerasinghe, at 388 Greenwich Street, New York, New York 10013. If you attend the 2019 Annual Meeting and want to vote in person, you can request that your previously submitted proxy not be used. To ensure that your vote is counted, please remember to submit your vote by 11:59 p.m. ET on April 15, 2019.

Q: What if I don’t vote for some of the matters listed on my proxy card?
A: If you return a signed proxy card without indicating voting instructions, your shares will be voted in accordance with the Board’s recommendation FOR the nominees listed on the card, FOR KPMG as independent registered public accounting firm for 2019, FOR Citi’s 2018 executive compensation, FOR the Citigroup 2019 Stock Incentive Plan, and AGAINST the stockholder proposals. If you only vote for certain matters, the remaining matters will be voted as set forth above. See also “Could other matters be decided at the 2019 Annual Meeting?”

Q: Can my shares held in street name be voted if I don’t return my voter instruction card and don’t attend the 2019 Annual Meeting?
A:

If you don’t vote your shares held in street name, your broker can vote your shares on matters that the New York Stock Exchange (NYSE) has ruled discretionary.

Discretionary Items. KPMG’s appointment is a discretionary item. NYSE member brokers who do not receive instructions from beneficial owners may vote on this proposal as follows: (i) a Citi affiliated member is permitted to vote your shares in the same proportion as all other shares are voted with respect to this proposal, and (ii) all other NYSE member brokers are permitted to vote your shares at their discretion.

Non-discretionary Items. Brokers will not be able to vote your shares on the election of Directors, the advisory vote to approve Citi’s 2018 executive compensation, the Citigroup 2019 Stock Incentive Plan, and the stockholder proposals if you fail to provide instructions. Generally, broker non-votes occur on a matter when a broker is not permitted to vote on that matter without instructions from the beneficial owner and instructions are not given.

If your shares are registered directly in your name, not in the name of a bank or broker, you must vote your shares or your vote will not be counted. Please vote your proxy so your vote can be counted.

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ABOUT THE 2019 ANNUAL MEETING 19

Q: If I hold shares through Citigroup’s employee benefit plans and do not provide voting instructions, how will my shares be voted?
A: If you hold shares of common stock through Citigroup’s employee benefit plans or stock incentive plans and do not provide voting instructions to the plans’ trustees or administrators, your shares will be voted in the same proportion as the shares beneficially owned through such plans for which voting instructions are received, unless otherwise required by law.

Q: What vote is required, and how will my votes be counted, to elect Directors and to adopt the other proposals?
A: The following chart describes the proposals to be considered at the meeting, the vote required to elect Directors and to adopt each of the other proposals, and the manner in which votes will be counted:

Proposal Voting Options Vote Required to Adopt
the Proposal
Effect of
Abstentions
Effect of
“Broker
Non-Votes”(1)
Election of Directors For, against, or abstain on each nominee A nominee for Director will be elected if the votes cast for such nominee exceed the votes cast against such nominee. No effect No effect
Ratification of KPMG For, against, or abstain The affirmative vote of a majority of the shares of common stock represented at the Annual Meeting and entitled to vote thereon. Treated as votes against Brokers have discretion to vote
Advisory vote to approve Citi’s 2018 executive compensation For, against, or abstain The affirmative vote of a majority of the shares of common stock represented at the Annual Meeting and entitled to vote thereon. Treated as votes against No effect
The Citigroup 2019 Stock Incentive Plan For, against, or abstain The affirmative vote of a majority of the shares of common stock represented at the Annual Meeting and entitled to vote thereon. Treated as votes against No effect
Three stockholder proposals For, against, or abstain The affirmative vote of a majority of the shares of common stock represented at the Annual Meeting and entitled to vote thereon. Treated as votes against No effect

(1) A broker non-vote generally occurs when a broker is not permitted to vote on a matter without instructions from a customer having beneficial ownership in the securities and has not received such instructions. Broker non-votes will not be counted as shares entitled to vote on the relevant proposal.

    

If a nominee for Director is not re-elected by the required vote, he or she will remain in office until a successor is elected and qualified or until his or her earlier resignation or removal. Citi’s By-laws provide that in the event a Director nominee is not re-elected, such Director shall offer to resign from his or her position as a Director. Unless the Board decides to reject the offer or to postpone the effective date of the offer, the resignation shall become effective 60 days after the date of the election.

The result of the votes on an advisory vote on Citi’s 2018 executive compensation is not binding on the Board, whether or not the resolution is passed under the voting standards described above. In evaluating the stockholder vote on the advisory resolution, the Board will consider the voting results in their entirety.


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20 ABOUT THE 2019 ANNUAL MEETING

Q: Is my vote confidential?
A:

In 2006, the Board adopted a confidential voting policy as part of its Corporate Governance Guidelines. Under the policy, except as necessary to meet applicable legal requirements or as otherwise described below, all votes, whether submitted by proxies, ballots, Internet voting, telephone voting, or otherwise are kept confidential for registered stockholders who request confidential treatment. If you are a registered stockholder and would like your vote kept confidential, please check the appropriate box on the proxy card or follow the instructions when submitting your vote by telephone, mobile phone, or by the Internet. If you hold your shares in “street name” or through an employee benefit plan or stock incentive plan, your vote already receives confidential treatment and you do not need to request confidential treatment in order to maintain the confidentiality of your vote.

The confidential voting policy will not apply in the event of a proxy contest or other solicitation based on an opposition Proxy Statement and in certain other limited circumstances. For further details regarding this policy, please see the Corporate Governance Guidelines, available on Citi’s website at www.citigroup.com.


Q: Could other matters be decided at the 2019 Annual Meeting?
A: We don’t know of any matters that will be considered at the Annual Meeting other than those described above. If a stockholder proposal that was excluded from this Proxy Statement is brought before the meeting, the Chair will declare such proposal out of order, and it will be disregarded, or we will vote the proxies AGAINST the proposal. If any other matters arise at the Annual Meeting that are properly presented at the meeting, the proxies will be voted at the discretion of the proxy holders.

Q: What happens if the meeting is postponed or adjourned?
A: Your proxy will still be good and may be voted at the postponed or adjourned meeting. You will still be able to change or revoke your proxy until it is voted.

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ABOUT THE 2019 ANNUAL MEETING 21

Q: Do I need a ticket to attend the 2019 Annual Meeting?
NEW ADMISSION PROCEDURES
A:

Yes, you will need an admission ticket or proof of ownership of Citi common stock to enter the Annual Meeting. Starting this year, we have streamlined the admission process for entry into the 2019 Annual Meeting. To promote an efficient admission process, we encourage all of our stockholders attending the meeting to pre-register and bring an admission ticket with them. Tickets can be printed by accessing Shareholder Meeting Registration at www.proxyvote.com and following the instructions provided (you will need the 16-digit Control Number included on your proxy card, voter instruction form or Notice of Internet Availability of Proxy Materials). If you are unable to print your ticket, please call Shareholder Meeting Registration Phone Support (toll free) at 1-844-318-0137 or (international toll call) at 1-925-331-6070 for assistance.

When you arrive at the Annual Meeting, you will be asked to present photo identification, such as a driver’s license, and provide one of the form(s) of alternative documentation listed below. If you arrive at the meeting without an admission ticket, we will admit you only if we are able to verify that you are a Citi stockholder. If you hold your shares in a joint account, both owners can be admitted to the Annual Meeting provided that proof of joint ownership is given. Due to space limitations, Citi will not be able to accommodate guests at the Annual Meeting. Tickets to the Annual Meeting are not transferable. A stockholder may appoint only one proxy to represent him or her at the Annual Meeting.


Record
Stockholder
Street Name Holder Proxy
for Record
Stockholder
Proxy
for Street
Name Holder
One of the following:
A printed admission ticket available online by clicking “Register for Meeting” link at www.proxyvote.com
Notice of Internet Availability of Proxy Materials
Proxy Card
One of the following:
A printed admission ticket available online at www.proxyvote.com
Notice of Internet Availability of Proxy Materials
Voting Instruction form from your bank or broker
A recent brokerage statement or letter from a bank or broker
Valid, written legal proxy naming you, signed by a record stockholder
AND
Either

Notice of Internet Availability of Proxy Materials
Or
Proxy Card
Valid and assignable written legal proxy naming you, signed by the street name holder’s bank or brokerage firm
AND
Either

Notice of Internet Availability of Proxy Materials
Voting Instruction form from the street name holder’s bank or broker
Or
A recent brokerage statement or letter from a bank or broker

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22  

Corporate Governance

Citigroup Inc. (Citigroup, Citi, or the Company) continually strives to maintain the highest standards of ethical conduct: reporting results with accuracy and transparency and maintaining full compliance with the laws, rules, and regulations that govern Citi’s businesses. Citi is active in ensuring its governance practices are at the leading edge of best practices. Below is a compilation of Citi’s Corporate Governance initiatives:

Good Governance

     
A standing Ethics and Culture Committee of the Board of Directors oversees management’s efforts to foster a culture of ethics within Citi;
 
No super-majority vote provisions in our Restated Certificate of Incorporation;
 
A declassified board structure;
 
By-laws provide that if Citi does not have an independent Chair of the Board, the Board is required to elect a lead independent Director;
 
87% of Citi’s Board Nominees are independent;
 
Majority vote standard for uncontested Director elections; and
 
In 2019, we were the first large U.S. company to disclose our unadjusted or “raw” pay gap for women and U.S. minorities, which measures median total compensation unadjusted for factors such as job function, level, and geography. See page 76 of this Proxy Statement for further information.
Stockholder Rights
In 2019, the Board, taking into account the result of the stockholder vote on a proposal presented at the 2018 Annual Meeting, amended Citi’s By-laws to provide that stockholders holding at least 20% of the outstanding common stock have the right to call a special meeting;
 
Proxy access by-law; and
 
Stockholders may act by written consent.
Executive Compensation
Strong executive compensation governance practices, including clawback policies and a requirement that executive officers must hold a substantial amount of vested Citi common stock for at least one year after they cease being executive officers;
 
Stock ownership commitment for the Board and executive officers; and
 
Members of Citi’s Board of Directors and Citi’s executive officers (i.e., Section 16 Insiders) are not permitted to hedge their Citi securities or to pledge their Citi securities as collateral for a loan.
Political Activity
Political Activities Statement (formerly Citi’s Political Contributions and Lobbying Statement) includes significant disclosure about our lobbying practices and oversight. The Political Activities Statement provides meaningful disclosure about our lobbying policies and procedures;
 
Nomination, Governance and Public Affairs Committee has oversight responsibility for trade association payments in addition to oversight responsibility for political contributions and lobbying activities; and
 
Transparency on practices around political contributions and trade and business associations through:
 
a link on our website to federal and state government websites where our lobbying activities are reported;
 
requiring trade and business associations to which Citi pays dues to attest that no portion of such payments is used for independent expenditures; and
 
listing the names of our significant trade and business associations on Citi’s website.

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Corporate Governance Materials Available on Citi’s Website

In addition to our Corporate Governance Guidelines, other information relating to corporate governance at Citi is available in the Corporate Governance section of our website at www.citigroup.com. Click on “About Us” and then “Corporate Governance.”

www.citigroup.com/citi/ investor/corporate_ governance.html

     
Audit Committee Charter
Ethics and Culture Committee Charter
Nomination, Governance and Public Affairs Committee Charter
Operations and Technology Committee Charter
Personnel and Compensation Committee Charter
Risk Management Committee Charter
Code of Conduct
Code of Ethics for Financial Professionals
Citi’s Compensation Philosophy
By-laws and Restated Certificate of Incorporation
Corporate Political Activities Statement
Global Citizenship Report
Banking on 2030: Citi & the Sustainable Development Goals
Environmental and Social Policy Framework
Finance for a Climate-Resilient Future: Citi’s TCFD Report
Statement on Human Rights
Citi’s U.K. Modern Slavery Act Statement
A list of our 2018 Political Contributions and the names of Citi’s significant trade and business associations

Citi stockholders may obtain printed copies of these documents by writing to Citigroup Inc., Corporate Governance, 388 Greenwich Street, 17th Floor, New York, New York 10013.

Annual Report

If you received these materials by mail, you should have also received Citi’s Annual Report to Stockholders for 2018 with them. The 2018 Annual Report is also available on Citi’s website at www.citigroup.com. We urge you to read these documents carefully. In accordance with the SEC’s rules, the Five-Year Performance Graph appears in the 2018 Annual Report on Form 10-K, which is included in Citi’s Annual Report to Stockholders for 2018.

Corporate Governance Guidelines

Citi’s Corporate Governance Guidelines (the Guidelines) embody many of our long-standing practices, policies, and procedures, which are the foundation of our commitment to best practices. The Guidelines are reviewed at least annually, and revised as necessary, to continue to reflect best practices. The full text of the Guidelines, as approved by the Board, is set forth on Citi’s website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Corporate Governance Guidelines.” The Guidelines outline the responsibilities, operations, qualifications, and composition of the Board.

Director Independence

Our goal is that at least two-thirds of the members of the Board be independent. Descriptions of our independence criteria and the results of the Board’s independence determinations are set forth below.

Board Committees

The Guidelines require that all members of the following committees of the Board: Audit; Nomination, Governance and Public Affairs; and Personnel and Compensation be independent. Committee members are appointed by the Board upon the recommendation of the Nomination, Governance and Public Affairs Committee. Committee membership and Chairs are rotated periodically. The Board and each Committee have the power to hire and fire independent legal, financial, or other advisors, as they may deem necessary, without consulting or obtaining the approval of management.

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24 CORPORATE GOVERNANCE

Additional Board Service

The number of other for-profit public or non-public company boards on which a Director may serve is subject to a case-by-case review by the Nomination, Governance and Public Affairs Committee, in order to ensure that each Director is able to devote sufficient time to performing his or her duties as a Director. Interlocking directorates are prohibited (inside Directors and executive officers of Citi may not sit on boards of companies where a Citi outside Director is an executive officer).

Change in Status or Responsibilities

If a Director has a substantial change in professional responsibilities, occupation, or business association, he or she is required to notify the Nomination, Governance and Public Affairs Committee and to offer his or her resignation from the Board. The Nomination, Governance and Public Affairs Committee will evaluate the facts and circumstances and make a recommendation to the Board whether to accept the resignation or request that the Director continue to serve on the Board. If a Director assumes a significant role in a not-for-profit entity, he or she is asked to notify the Nomination, Governance and Public Affairs Committee.

Attendance at Meetings

Directors are expected to attend Board meetings and meetings of the Committees on which they serve and the Annual Meeting of stockholders. All of the Directors then in office attended Citi’s 2018 Annual Meeting.

Evaluation of Board Performance

The Nomination, Governance and Public Affairs Committee nominates one of the members of the Board to serve as Chair of the Board on an annual basis. The Nomination, Governance and Public Affairs Committee also conducts an annual review of Board performance in which the full Board participates, and each standing committee (except for the Executive Committee) conducts its own self-evaluation. As part of the self-evaluation, the Board engages in an examination of its own performance of its obligations with regards to such matters as regulatory requirements, strategic and financial oversight, oversight of risk management, executive compensation, succession planning, and governance matters, among many other topics. The committees evaluate their performance against the requirements of their charters and other aspects of their responsibilities. The full Board and each committee then discuss the results of their respective self-evaluations in executive session, highlighting actions to be taken in response to the discussion. See Board Self-Assessment Process on page 31 for further information.

Directors Access to Senior Management and Director Orientation

Directors have full and free access to senior management and other employees of Citi. New Directors are provided with an orientation program to familiarize them with Citi’s businesses, regions, and functions as well as its legal, compliance, regulatory, and risk profile. Citi provides educational sessions on a variety of topics throughout the year for all members of the Board. These sessions are designed to allow Directors to, for example, develop a deeper understanding of a business issue or a complex financial product.

Succession Planning

The Board reviews the Personnel and Compensation Committee’s report on the performance of senior executives in order to ensure that they are providing the highest quality leadership for Citi. The Board also works with the Nomination, Governance and Public Affairs Committee to evaluate potential successors to the Chief Executive Officer (CEO). With respect to regular succession of the CEO and senior management, Citi’s Board evaluates internal, and, when appropriate, external candidates. To find external candidates, Citi seeks input from the members of the Board and senior management and/or from recruiting firms. To develop internal candidates, Citi engages in

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CORPORATE GOVERNANCE 25

a number of practices, formal and informal, designed to familiarize the Board with Citi’s talent pool. The formal process involves an annual talent review conducted by senior management at which the Board studies the most promising members of senior management. The Board learns about each person’s experience, skills, areas of expertise, accomplishments, and goals. This review is conducted at a regularly scheduled Board meeting on an annual basis. In addition, members of senior management are periodically asked to make presentations to the Board at Board meetings and Board strategy sessions. These presentations are made by senior managers of the various business units as well as those who serve in corporate functions. The purpose of the formal review and other interaction is to ensure that Board members are familiar with the talent pool inside and outside Citi from which the Board would be able to choose successors to the CEO and evaluate succession for other senior managers as necessary from time to time.

Charitable Contributions

If a Director, or an immediate family member who shares the Director’s household, serves as a director, trustee, or executive officer of a foundation, university, or other not-for-profit organization, and such entity receives contributions from Citi and/or the Citi Foundation, such contributions must be reported to the Nomination, Governance and Public Affairs Committee at least annually.

Insider Investments and Transactions

Members of Citi’s Board of Directors and Citi’s executive officers (i.e., Section 16 Insiders) are not permitted to hedge their Citi securities or to pledge their Citi securities as collateral for a loan. The Guidelines restrict certain financial transactions between Citi and its subsidiaries on the one hand and Directors, senior management, and their immediate family members on the other. Personal loans from Citi or its subsidiaries to Citi’s Directors and its most senior executives, or immediate family members who share any such person’s household, are prohibited, except for margin loans to employees of a broker-dealer subsidiary of Citi, mortgage loans, home equity loans, consumer loans, credit cards, and overdraft checking privileges, all made on market terms in the ordinary course of business. See Certain Transactions and Relationships, Compensation Committee Interlocks, and Insider Participation on pages 38-39 of this Proxy Statement.

The Guidelines prohibit investments or transactions by Citi or its executive officers and those immediate family members who share an executive officer’s household in a partnership or other privately held entity in which an outside Director is a principal, or in a publicly traded company in which an outside Director owns or controls more than a 10% interest. Directors and those immediate family members who share the Director’s household are not permitted to receive initial public offering allocations. Directors and their immediate family members may participate in Citi-sponsored investment activities, provided they are offered on the same terms as those offered to similarly situated non-affiliated persons. Under certain circumstances, or with the approval of the appropriate committee, members of senior management may participate in certain Citi-sponsored investment opportunities. Finally, there is a prohibition on certain investments by Directors and executive officers in third-party entities when the opportunity comes solely as a result of their position with Citi.

Director Independence

The Board has adopted categorical standards to assist the Board in evaluating the independence of each of its Directors. The categorical standards, which are set forth below, describe various types of relationships that could potentially exist between a Director or an immediate family member of a Director and Citi, and set thresholds at which such relationships would be deemed to be material. Provided that no relationship or transaction exists that would disqualify a Director under the categorical standards and no other relationships or transactions exist of a type not specifically mentioned in the categorical standards that, in the Board’s opinion, taking into account all facts and circumstances, would impair a Director’s ability to exercise his or her independent judgment, the Board will deem such person to be independent.

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26 CORPORATE GOVERNANCE

The Board and the Nomination, Governance and Public Affairs Committee reviewed certain information obtained from Directors’ responses to a questionnaire asking about their relationships with Citi, and those of their immediate family members and primary business or charitable affiliations and other potential conflicts of interest, as well as certain data collected by Citi’s businesses related to transactions, relationships, or arrangements between Citi on the one hand and a Director, immediate family member of a Director, or a primary business or charitable affiliation of a Director, on the other. The Board reviewed certain relationships or transactions between the Directors or immediate family members of the Directors or their primary business or charitable affiliations and Citi and determined that the relationships or transactions complied with the Corporate Governance Guidelines and the related categorical standards. The Board also determined that, applying the Guidelines and standards, which are intended to comply with the NYSE corporate governance rules, and all other applicable laws, rules, and regulations, each of the following Director nominees standing for re-election and current board members is independent:


Ellen M. Costello
 
Lew W. (Jay) Jacobs, IV
 
James S. Turley
John C. Dugan
 
Renée J. James
 
Deborah C. Wright
Duncan P. Hennes
     
Eugene M. McQuade
     
Ernesto Zedillo Ponce de Leon
Peter B. Henry
Gary M. Reiner
S. Leslie Ireland
Diana L. Taylor

The Board has determined that Mr. McQuade is independent because he retired from employment in May 2015, over three years ago. The Board has determined that Michael L. Corbat and Barbara Desoer are not independent. Mr. Corbat is our Chief Executive Officer and Ms. Desoer is the Chief Executive Officer of Citibank, N.A., our largest banking subsidiary. Ms. Desoer is scheduled to retire as the Chief Executive Officer of Citibank, N.A. before Citi’s 2019 Annual Meeting.

Independence Standards

To be considered independent, a Director must meet the following categorical standards as adopted by our Board and reflected in our Corporate Governance Guidelines. In addition, there are other independence standards under NYSE corporate governance rules that apply to all directors and certain independence standards under SEC, Internal Revenue Code (IRC), and Federal Deposit Insurance Corporation (FDIC) rules that apply to specific committees.

Categorical Standards

Advisory, Consulting and Employment Arrangements

During any 12-month period within the last three years, neither a Director nor any Immediate Family Member of a Director shall have received more than $120,000 in direct compensation from Citi, other than amounts paid (a) pursuant to Citi’s Amended and Restated Compensation Plan for Non-Employee Directors, (b) pursuant to a pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service) or (c) to an Immediate Family Member of a Director who is a non-executive employee of Citi or one of its subsidiaries.
In addition, no member of the Audit Committee may accept a direct or indirect consulting, advisory or other compensatory fee from Citi or one of its subsidiaries, other than (a) fees for service as a member of the Board of Directors of Citi or one of its subsidiaries (including committees thereof) or (b) receipt of fixed amounts of compensation under a Citi retirement plan, including deferred compensation, for prior service with Citi, provided that such compensation is not contingent in any way on continued service.

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Business Relationships

All business relationships, lending relationships, deposit and other banking relationships between the Company and a Director’s primary business affiliation or the primary business affiliation of an immediate family member of a Director must be made in the ordinary course of business and on substantially the same terms as those prevailing at the time for comparable transactions with non-affiliated persons.
In addition, the aggregate amount of payments for property or services in any of the last three fiscal years by the Company to, and to the Company from, any company of which a Director is an executive officer or employee or where an immediate family member of a Director is an executive officer, must not exceed the greater of $1 million or 2% of such other company’s consolidated gross revenues in any single fiscal year.
Loans may be made or maintained by the Company to a Director’s primary business affiliation or the primary business affiliation of an immediate family member of a Director, only if the loan (i) is made in the ordinary course of business of the Company or one of its subsidiaries, is of a type that is generally made available to other customers, and is on market terms, or terms that are no more favorable than those offered to other customers; (ii) complies with applicable law, including the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley), Regulation O of the Board of Governors of the Federal Reserve, and the Federal Deposit Insurance Corporation (FDIC) Guidelines; (iii) when made does not involve more than the normal risk of collectability or present other unfavorable features; and (iv) is not classified by the Company as Substandard (II) or worse, as defined by the Office of the Comptroller of the Currency in its “Rating Credit Risk” Comptroller’s Handbook.

Charitable Contributions

Annual contributions in any of the last three calendar years from the Company and/or the Citi Foundation to a charitable organization of which a Director, or an immediate family member who shares the Director’s household, serves as a Director, trustee, or executive officer (other than the Citi Foundation and other charitable organizations sponsored by the Company) may not exceed the greater of $250,000 or 10% of the charitable organization’s annual consolidated gross revenue.

Employment/Affiliations

A Director shall not:
 
(i) be or have been an employee of the Company within the last three years;
(ii) be part of, or within the past three years have been part of, an interlocking directorate in which a current executive officer of the Company serves or has served on the compensation committee of a company that concurrently employs or employed the Director as an executive officer; or
(iii) be or have been affiliated with or employed by (a) Citi’s present or former primary outside auditor or (b) any other outside auditor of Citi and personally worked on Citi’s audit, in each case within the three-year period following the auditing relationship.
 
A Director may not have an immediate family member who:
 
(i) is an executive officer of the Company or has been within the last three years;
(ii) is, or within the past three years has been, part of an interlocking directorate in which a current executive officer of the Company serves or has served on the compensation committee of a company that concurrently employs or employed such immediate family member as an executive officer; or
(iii) (a) is a current partner of Citi’s primary outside auditor, or a current employee of Citi’s primary outside auditor and personally works on Citi’s audit, or (b) was within the last three years (but is no longer) a partner or employee of Citi’s primary auditor and personally worked on Citi’s audit within that time.

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28 CORPORATE GOVERNANCE

Immaterial Relationships and Transactions

The Board may determine that a Director is independent notwithstanding the existence of an immaterial relationship or transaction between Citi and (i) the Director, (ii) an immediate family member of the Director or (iii) the Director’s or immediate family member’s business or charitable affiliations, provided Citi’s Proxy Statement includes a specific description of such relationship as well as the basis for the Board’s determination that such relationship does not preclude a determination that the Director is independent. Relationships or transactions between Citi and (i) the Director, (ii) an immediate family member of the Director or (iii) the Director’s or immediate family member’s business or charitable affiliations that comply with the Corporate Governance Guidelines, including, but not limited to, the Director Independence Standards that are part of the Corporate Governance Guidelines and the sections titled Financial Services, Personal Loans and Investments/Transactions, are deemed to be categorically immaterial and do not require disclosure in the Proxy Statement (unless such relationship or transaction is required to be disclosed pursuant to Item 404 of SEC Regulation S-K).

Definitions

For purposes of these Corporate Governance Guidelines, (i) the term “immediate family member” means a Director’s or executive officer’s (designated as such pursuant to Section 16 of the Securities Exchange Act of 1934, as amended (“Exchange Act“)) spouse, parents, step-parents, children, step-children, siblings, mother- and father-in law, sons- and daughters-in-law, and brothers- and sisters-in-law and any person (other than a tenant or domestic employee) who shares the Director’s household; (ii) the term “Primary Business Affiliation” means an entity of which the Director or executive officer, or an immediate family member of such a person, is an officer, partner or employee or in which the Director, executive officer or immediate family member owns directly or indirectly at least a 5% equity interest; and (iii) the term “Related Party Transaction” means any financial transaction, arrangement or relationship in which (a) the aggregate amount involved will or may be expected to exceed $120,000 in any fiscal year, (b) Citi is a participant, and (c) any Related Person (any Director, any executive officer of Citi, any nominee for Director, any shareholder owning in excess of 5% of the total equity of Citi, and any immediate family member of any such person) has or will have a direct or indirect material interest.

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Meetings of the Board of Directors and Committees

The Board of Directors met 20 times in 2018. During 2018, the Audit Committee met 21 times, the Ethics and Culture Committee met 4 times, the Nomination, Governance and Public Affairs Committee met 10 times, the Operations and Technology Committee met 5 times, the Personnel and Compensation Committee met 13 times, and the Risk Management Committee met 13 times. In addition, a subcommittee of the Risk Management Committee met 9 times. The Executive Committee did not meet in 2018.

During 2018, substantially all of the members of the Board served on and/or chaired one or more ad hoc committees covering compliance matters or served on an international subsidiary board. In addition, during 2018, Mses. Costello and Ireland and Messrs. Hennes, McQuade, Santomero, and Turley, served on the Board of Directors of Citibank, N.A., which is a wholly owned subsidiary of Citi.

Each incumbent Director attended at least 75% of the meetings of the Board and of the standing committees of which he or she was a member during 2018.

Meetings of Non-Management Directors

Citi’s non-management Directors meet in executive session without any management Directors in attendance whenever the full Board convenes for a regularly scheduled meeting. During 2018, Mr. O’Neill presided at each executive session of the non-management Directors. In addition, the independent Directors met in executive session during 2018.

Board Leadership Structure

Citi currently has an independent Chair separate from the CEO, a structure that has been in place since 2009. The Board believes it is important to maintain flexibility in its Board leadership structure and has had in place different leadership structures in the past, depending on the Company’s needs at the time, but firmly supports having an independent Director in a Board leadership position at all times. Accordingly, Citi’s Board, on December 15, 2009, adopted a By-law amendment which provides that if Citi does not have an independent Chair, the Board will elect a lead independent Director having similar duties to an independent Chair, including leading the executive sessions of the non-management Directors at Board meetings. Citi’s Chair provides independent leadership of the Board. Having an independent Chair or Lead Director enables non-management Directors to raise issues and concerns for Board consideration without immediately involving management. The Chair or Lead Director also serves as a liaison between the Board and senior management. Citi’s Board has determined that the current structure, an independent Chair separate from the CEO, is the most appropriate structure at this time, while ensuring that, at all times, there will be an independent Director in a Board leadership position. The Board believes its approach to risk oversight, including, importantly, having a standing Risk Management Committee and the reporting line of the Chief Risk Officer to the Risk Management Committee, ensures that the Board can choose many leadership structures without experiencing a material impact on its oversight of risk.

Citi has had an independent Chair since 2009. Following Michael O’Neill’s retirement as Chair on January 1, 2019, the Board appointed John Dugan as independent Chair to succeed him.

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Board Diversity

Diversity is among the critical factors that the Nomination, Governance and Public Affairs Committee considers when evaluating the composition of the Board. For a company like Citi, which operates in more than 100 countries around the globe, diversity includes race, ethnicity, and gender as well as the diversity of the communities and geographies in which Citi operates. Included in the qualifications for Directors listed in the Company’s Corporate Governance Guidelines is “whether the candidate has special skills, expertise and background that would complement the attributes of the existing Directors, taking into consideration the diverse communities and geographies in which the Company operates.” Citi’s Board is committed to ensuring that it is composed of individuals whose backgrounds reflect the diversity represented by our employees, customers, and stakeholders. The candidates nominated for election at Citi’s 2019 Annual Meeting exemplify that diversity: six nominees are women and three nominees are African-American or Hispanic. In addition, each Director candidate contributes to the Board’s overall diversity by providing a variety of perspectives, personal and professional experiences, and backgrounds, as well as other characteristics, such as global and international business experience. The Board believes that the current nominees reflect an appropriate diversity of gender, age, race, geographical background, and experience and is committed to continuing to consider diversity issues in evaluating the composition of the Board.

Director Education Program

Citi has a robust Director Education Program that begins with an orientation for newly appointed Directors, providing two days of in-depth training covering all aspects of our business, including coverage of Citi’s institutional and consumer businesses; financial reporting; an overview of the Company’s risk management, audit, compliance, and legal functions; and an overview of Citi’s primary banking subsidiary, Citibank, N.A. There is also a continuing education program, which includes presentations focusing on industry, regulatory and governance topics and presentations from the various lines of our business on emerging issues or strategic initiatives to provide our Directors with the opportunity to expand their insight into Citi’s business operations and activities. Directors also have access to external programming and seminars to supplement their Citi-provided education.

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Board Self-Assessment Process

Annual Board Self-Evaluations*

The Board conducts annual evaluations through the use of a written questionnaire that covers a broad range of matters relating to governance, meetings, materials, and other agenda topics, including Strategic Planning, Corporate Oversight, Succession Planning, Conduct and Culture, Risk Management Oversight, Regulatory Requirements, and Management Compensation.

 

Summary of the Written Evaluations

Citi’s Corporate Governance Office aggregates and summarizes our Directors’ responses to the questionnaires, highlighting comments and high and low scores on various topics. Responses are not attributed to specific Board members to promote candor. The aggregated results, including all written comments, together with data analyzing trends or results over prior years, are shared with the Board.

 

Board Review

Using the aggregated results as a guide, our Chair leads a discussion with the full Board during an executive session. All Board members are encouraged to provide feedback on the results.

 

Actions

As an outcome of these discussions, the Board takes specific actions which may include providing guidance to management on specific Board-related initiatives.


*

Each standing committee conducts an annual self-assessment and reports the results to the Board, which include how each committee’s effectiveness may be enhanced.

Board’s Role in Risk Oversight

The Board oversees Citi’s global risk management framework.

           
Risk Management Committee
approves Citi’s Risk Governance Framework
reviews and approves risk management policies on the establishment of risk limits and reviews risk management programs for Citi and its subsidiaries
consults with management on the effectiveness of risk identification, measurement, and monitoring processes, and the adequacy of staffing and action plans
provides oversight of, among others, matters related to Citi’s Comprehensive Capital Analysis and Review (CCAR) practices, Resolution and Recovery Planning, and cybersecurity
         
Chief Risk Officer
delivers risk report at regularly scheduled Board meetings
responsible for Global Risk Management
responsible for an integrated effort to identify, assess, and manage risks
reports to the Chief Executive Officer and Risk Management Committee
reports at least twice annually to the Personnel and Compensation Committee on incentive compensation
Board Committees:
Audit Committee
provides oversight of compliance risk, cybersecurity risk, fraud risk, financial reporting/internal control risk, and operational risk matters
Ethics and Culture Committee
provides oversight of Citi’s Conduct Risk Management Program
Nomination, Governance and Public Affairs Committee
provides oversight of reputational issues and legal and regulatory compliance risks as they relate to Corporate Governance matters
Operations and Technology Committee
provides oversight of cybersecurity as well as privacy and data security
Personnel and Compensation Committee
provides oversight of incentive compensation plans and risk related to compensation
 

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32 CORPORATE GOVERNANCE

At each regularly scheduled Board meeting, the Board receives a risk report from the Chief Risk Officer with respect to the Company’s approach to management of major risks, including management’s risk mitigation efforts, where appropriate. Global Risk Management, led by the Chief Risk Officer, is a company-wide function that is responsible for an integrated effort to identify, assess, and manage risks that may affect Citi’s ability to execute on its corporate strategy and fulfill its business objectives. The Board’s role is to oversee this effort.

The Risk Management Committee enhances the Board’s oversight of risk management. The Committee’s role is one of oversight, recognizing that management is responsible for executing Citi’s risk management policies.

Board’s Role in Cybersecurity Oversight

The Board of Directors provides oversight of management’s efforts to address cybersecurity risk. The Board and various Committees receive periodic reports and engage in discussions throughout the year on the effectiveness of Citi’s overall cybersecurity program, exploring Citi’s inherent risks, the road map for addressing these risks, and Citi’s progress in doing so. Board members receive contemporaneous reporting on any significant cyber events that may occur—which includes efforts at response, discussions of legal obligations, and the status of outreach to regulators—and provides guidance to management as appropriate.

Committees of the Board of Directors

The following are the standing committees of the Board of Directors:

Audit Committee

Members:

Ellen M. Costello
John C. Dugan
Peter B. Henry
Lew W. (Jay) Jacobs, IV
Anthony M. Santomero
James S. Turley (Chair)
Deborah C. Wright

Committee Meetings
in 2018:

21

Charter:

The Audit Committee Charter, as adopted by the Board, is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Citigroup Board of Directors’ Committee Charters.”

Committee Roles and Responsibilities:

The Audit Committee assists the Board in fulfilling its oversight responsibility relating to:

the integrity of Citigroup’s consolidated financial statements, financial reporting process, and systems of internal accounting and financial controls;
the performance of the internal audit function (“Internal Audit”);
the annual independent integrated audit of Citigroup’s consolidated financial statements and effectiveness of Citigroup’s internal control over financial reporting, the engagement of the independent registered public accounting firm (“Independent Auditors”), and the evaluation of the Independent Auditors’ qualifications, independence and performance;
policy standards and guidelines for risk assessment and risk management;
Citigroup’s compliance with legal and regulatory requirements, including Citigroup’s disclosure controls and procedures; and
the fulfillment of the other responsibilities set out in the Audit Committee’s charter. The report of the Committee required by the rules of the SEC is included in this Proxy Statement.

The Board has determined that each of Ms. Costello and Messrs. Dugan, Jacobs, Santomero and Turley qualifies as an “audit committee financial expert” as defined by the SEC and each such Director as well as Ms. Wright and Mr. Henry is considered “financially literate” under NYSE rules, and, in addition to being independent according to the Board’s independence standards as set out in its Corporate Governance Guidelines, each is independent within the meaning of applicable SEC rules, the corporate governance rules of the NYSE, and the FDIC guidelines.

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Ethics and Culture
Committee

Members:

Peter B. Henry
Franz B. Humer (Chair)
Lew W. (Jay) Jacobs, IV
Deborah C. Wright
Ernesto Zedillo
     Ponce de Leon

Committee Meetings
in 2018:

4

Charter:

The Ethics and Culture Committee Charter, as adopted by the Board, is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Citigroup Board of Directors’ Committee Charters.”

Committee Roles and Responsibilities:

The Ethics and Culture Committee oversees management’s efforts to foster a culture of ethics within the organization; oversees and helps shape the definition of Citi’s value proposition; oversees management’s efforts to enhance and communicate Citi’s value proposition, evaluates management’s progress, and provides feedback on these efforts; reviews and assesses the culture of the organization to determine if further enhancements are needed to foster ethical decision-making by employees; and oversees management’s efforts to support ethical decision-making in the organization, evaluates management’s progress, and provides feedback on these efforts. The Committee also reviews and assesses the adequacy of Citi’s Code of Conduct and Code of Ethics for Financial Professionals and approves any waivers to either Code. The Committee also provides oversight of Citi’s Conduct Risk Management Program, whose objective is to enhance Citi’s culture of compliance and control through the management, minimization, and mitigation of Citi’s conduct risks.


Executive Committee

Members:

John C. Dugan (Chair)
Duncan P. Hennes
Franz B. Humer
Gary M. Reiner
Anthony M. Santomero
Diana L. Taylor
James S. Turley

Committee Meetings
in 2018:

None

Committee Roles and Responsibilities:

The Executive Committee acts on behalf of the Board if a matter requires Board action before a meeting of the full Board can be held.

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34 CORPORATE GOVERNANCE

Nomination,
Governance and
Public Affairs
Committee

Members:

John C. Dugan
Peter B. Henry
Diana L. Taylor (Chair)
Ernesto Zedillo
       Ponce de Leon

Committee Meetings in 2018:

10

Charter:

The Nomination, Governance and Public Affairs Committee Charter, as adopted by the Board, is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Citigroup Board of Directors’ Committee Charters.”

Committee Roles and Responsibilities:

The Nomination, Governance and Public Affairs Committee is responsible for identifying individuals qualified to become Board members and recommending to the Board the Director nominees for the next Annual Meeting of stockholders. It leads the Board in its annual review of the Board’s performance and makes recommendations as to the composition of the committees for appointment by the Board. The Committee takes a leadership role in shaping corporate governance policies and practices, including recommending to the Board the Corporate Governance Guidelines and monitoring Citi’s compliance with these policies and practices and the Guidelines. The Committee is responsible for reviewing and approving all related party transactions involving a Director or an immediate family member of a Director and any related party transaction involving an executive officer or immediate family member of an executive officer if the transaction is valued at $50 million or more, in each case, other than certain enumerated ordinary course transactions. See Certain Transactions and Relationships, Compensation Committee Interlocks, and Insider Participation on pages 38-39 of this Proxy Statement for a complete description of the Policy on Related Party Transactions.

The Committee, as part of the Board’s executive succession planning process, evaluates and nominates potential successors to the CEO and provides an annual report to the Board on CEO succession. The Committee also reviews Director Compensation and Benefits. The Committee is responsible for reviewing Citi’s policies and programs that relate to public issues of significance to Citi and the public at large and reviewing relationships with external constituencies and issues that impact Citi’s reputation. The Committee also has the responsibility for reviewing public policy and reputational issues facing Citi; reviewing political contributions and lobbying expenditures and payments to trade associations made by Citi, and charitable contributions made by Citi and the Citi Foundation; reviewing Citi’s policies and practices regarding supplier diversity; reviewing the work of Citi’s Business Practices Committees; and reviewing Citi’s Citizenship and Sustainability policies and programs, including environmental and human rights policies. The Committee’s focus is global, reflecting Citi’s global footprint. The Committee also makes recommendations to the Board regarding amendments to the Company’s Major Expenditure Program – Limits of Authority.

The Board has determined that, in addition to being independent according to the Board’s independence standards as set out in its Corporate Governance Guidelines, each of the members of the Nomination, Governance and Public Affairs Committee is independent according to the corporate governance rules of the NYSE.

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Operations and
Technology
Committee

Members:

S. Leslie Ireland
Renée J. James
Gary M. Reiner (Chair)

Committee Meetings
in 2018:

5

Charter:

The Operations and Technology Committee Charter, as adopted by the Board, is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Citigroup Board of Directors’ Committee Charters.”

Committee Roles and Responsibilities:

The Operations and Technology Committee oversees the scope, direction, quality, and execution of Citi’s technology strategies formulated by management, and provides guidance on technology as it may pertain to, among other things, Citi business products and technology platforms.

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36 CORPORATE GOVERNANCE

Personnel and
Compensation
Committee

Members:

John C. Dugan
Duncan P. Hennes (Chair)
Lew W. (Jay) Jacobs, IV
Gary M. Reiner
Diana L. Taylor

Committee Meetings
in 2018:

13

Charter:

The Personnel and Compensation Committee Charter is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Citigroup Board of Directors’ Committee Charters.”

Committee Roles and Responsibilities:

The Personnel and Compensation Committee has been delegated broad authority to oversee compensation of employees of the Company and its subsidiaries and affiliates. The Committee regularly reviews Citi’s management resources and performance of senior management. The Committee is responsible for determining the compensation for the CEO and approving the compensation of other executive officers of the Company and members of Citi’s Operating Committee. The Committee is also responsible for approving the incentive compensation structure for other members of senior management and certain highly compensated employees (including discretionary incentive awards to covered employees as defined in applicable bank regulatory guidance), in accordance with guidelines established by the Committee from time to time. The Committee also has broad oversight of compliance with bank regulatory guidance governing Citi’s incentive compensation.

The Committee annually reviews and discusses the Compensation Discussion and Analysis required to be included in the Company’s Proxy Statement with management, and, if appropriate, recommends to the Board that the Compensation Discussion and Analysis be included. Additionally, the Committee reviews and approves the overall goals of Citi’s material incentive compensation programs, including as expressed through Citi’s Compensation Philosophy, and provides oversight for Citi’s incentive compensation programs so that they both (i) appropriately balance risk and financial results in a manner that does not encourage employees to expose Citi to imprudent risks, and (ii) are consistent with bank safety and soundness. Toward that end, the Committee meets periodically with Citi’s Chief Risk Officer to discuss the risk attributes of Citi’s incentive compensation programs.

The Committee has the power to hire and fire independent compensation consultants, legal counsel, or financial or other advisors as it may deem necessary to assist it in the performance of its duties and responsibilities, without consulting or obtaining the approval of senior management of the Company. The Committee has retained Frederic W. Cook & Co. (FW Cook) to provide the Committee with advice on Citi’s compensation programs for senior management. The amount paid to FW Cook in 2018 for advice on executive compensation matters is disclosed in the Compensation Discussion and Analysis on page 97 of this Proxy Statement.

The Board has determined that in addition to being independent according to the Board’s independence standards as set out in its Corporate Governance Guidelines, each of the members of the Personnel and Compensation Committee is independent according to the corporate governance rules of the NYSE. Each of such Directors is a “non-employee Director,” as defined in Section 16 of the Securities Exchange Act of 1934, and is an “outside Director,” as defined by Section 162(m) of the Internal Revenue Code.

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Risk Management
Committee

Members:

Ellen M. Costello
John C. Dugan
Duncan P. Hennes
Franz B. Humer
Renée J. James
Eugene M. McQuade
Anthony M.
       Santomero (Chair)
James S. Turley
Ernesto Zedillo
       Ponce de Leon

Committee Meetings
in 2018:

13

Charter:

The Risk Management Committee Charter is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Citigroup Board of Directors’ Committee Charters.”

Committee Roles and Responsibilities:

The Risk Management Committee has been delegated authority to assist the Board in fulfilling its responsibility with respect to (i) oversight of Citigroup’s risk management framework, including the significant policies and practices used in managing credit, market, operational, and certain other risks, (ii) oversight of Citigroup’s policies and practices relating to funding risk, liquidity risk, and price risk, which constitute significant components of market risk, and risks pertaining to capital management, and (iii) oversight of the performance of the Fundamental Credit Risk (“FCR”) credit review function. The Committee reports to the Board of Directors regarding Citigroup’s risk profile and its risk management framework, including the significant policies and practices employed to manage risks in Citigroup’s businesses, and the overall adequacy of the Risk Management function. The Committee provides oversight of Citi’s CCAR and Resolution and Recovery Planning efforts. The Committee also reviews risk related to information security and cybersecurity, including steps taken by management to control such risks, and coordinates with the Personnel and Compensation Committee in relation to that committee’s role with respect to risk matters related to compensation, which includes the approval of the Global Head of FCR’s base compensation, adjustments and incentive compensation.

The Risk Management Committee created a subcommittee in 2016 to provide oversight of data governance, data quality, and data integrity. Ms. James and Messrs. Santomero (Chair) and Turley are members of the Risk Subcommittee. The Risk Subcommittee met 9 times in 2018.


Audit Ethics and
Culture
Executive Nomination,
Governance
and Public
Affairs
Operations
and
Technology
 Personnel and
Compensation
Risk
Management
Michael L. Corbat
Ellen M. Costello
John C. Dugan
Duncan P. Hennes
Peter B. Henry
Franz B. Humer
S. Leslie Ireland
Lew W. (Jay) Jacobs, IV
Renée J. James
Eugene M. McQuade
Gary M. Reiner
Anthony M. Santomero
Diana L. Taylor
James S. Turley
Deborah C. Wright
Ernesto Zedillo
       Ponce de Leon
committee member
committee chair

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Involvement in Certain Legal Proceedings

There are no legal proceedings to which any Director, officer, or The Vanguard Group (which owns more than 5% of Citi’s common stock), or any affiliate thereof, is a party adverse to Citi or in which any such person has a material interest adverse to Citi. In lieu of participating in class action settlements of claims entered into by Citi and other banks relating to alleged manipulation of the foreign exchange market, and which received final court approval in 2018, numerous BlackRock funds and other plaintiffs filed a complaint in U.S. District Court for the Southern District of New York on November 7, 2018 against Citi and 15 other banks. In this action, plaintiffs assert that defendants conspired to manipulate the foreign exchange market between 2003 and 2013. BlackRock, Inc. owns more than 5% of Citi’s common stock.

Certain Transactions and Relationships, Compensation Committee Interlocks, and Insider Participation

The Board has adopted a policy setting forth procedures for the review, approval, and monitoring of transactions involving Citi and related persons (Directors, Senior Managers, 5% stockholders, Immediate Family Member or Primary Business Affiliations). A copy of Citi’s Policy on Related Party Transactions is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Citi Policies.” Under the policy, the Nomination, Governance and Public Affairs Committee is responsible for reviewing and approving all related party transactions involving related persons. Directors may not participate in any discussion or approval of a related party transaction in which he or she or any member of his or her immediate family is a related person, except that the Director must provide all material information concerning the related party transaction to the Nomination, Governance and Public Affairs Committee. The Nomination, Governance and Public Affairs Committee is also responsible for reviewing and approving all related party transactions valued at more than $50 million involving an executive officer or an Immediate Family Member of an executive officer. The Transaction Review Committee, composed of Citi’s President, General Counsel, Chief Financial Officer, Chief Compliance Officer, Chief Risk Officer, and Head of Human Resources, is responsible for reviewing and approving all related party transactions valued at less than $50 million involving an executive officer or an Immediate Family Member of an executive officer. The policy also contains a list of categories of transactions involving related persons that are pre-approved under the policy, and therefore need not be brought to the Nomination, Governance and Public Affairs Committee or the Transaction Review Committee for approval.

The Nomination, Governance and Public Affairs Committee and the Transaction Review Committee will review the following information when assessing a related party transaction:

the terms of such transaction;
the related person’s interest in the transaction;
the purpose and timing of the transaction;
whether Citi is a party to the transaction, and if not, the nature of Citi’s participation in the transaction;
if the transaction involves the sale of an asset, a description of the asset, including date acquired and cost basis;
information concerning potential counterparties in the transaction;
the approximate dollar value of the transaction and the approximate dollar value of the related person’s interest in the transaction;
a description of any provisions or limitations imposed as a result of entering into the proposed transaction;
whether the proposed transaction includes any potential reputational risk issues that may arise as a result of, or in connection with, the proposed transaction; and
any other relevant information regarding the transaction.

Based on information contained in a Schedule 13G filed with the SEC, BlackRock and Vanguard reported that they beneficially owned 5% or more of the outstanding shares of Citi’s common stock as of December 31, 2018 — see Stock Ownership — Owners of More than 5% of Citi Common Stock in this Proxy Statement on page 44. During 2018, our subsidiaries provided ordinary course lending, trading, and other financial services to BlackRock and Vanguard and their respective affiliates and clients. These transactions were entered into on an arm’s length

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basis and contain customary terms and conditions and were on substantially the same terms as comparable transactions with unrelated third parties. Acciones y Valores Banamex, S.A. de C.V., Servicios Corporativos de Finanzas, S.A. de C.V., and Grupo Financiero Citibanamex, S.A. de C.V. (“Citibanamex”) entered into an agreement with BlackRock, Inc. and certain of its affiliates pursuant to which BlackRock would acquire the asset management business of Citibanamex in Mexico. The transaction includes the sale of Impulsora de Fondos Banamex, S.A. de C.V., (“Impulsora”) legal vehicle, and its advisory role for 52 mutual funds and certain managed account relationships, and certain intellectual property and vendor contracts required to operate the business. The closing for this transaction occurred in September 2018. Consideration for the sale consisted of $350 million and certain future payments if defined targets are met. In connection with the closing, Citibanamex and BlackRock also entered into a long-term distribution agreement to offer BlackRock asset management products to Citibanamex clients in Mexico. The agreement provides a framework under which Citibanamex would distribute BlackRock products in Mexico and includes terms relating to pricing, preferential access, and product support. The Nomination, Governance and Public Affairs Committee reviewed the terms of the sale and approved the transaction in accordance with the Related Party Transaction Policy. Based on information contained in a Schedule 13G filed with the SEC, BlackRock reported that it beneficially owns more than 5% of Citi’s common stock.

Citi has established funds in which employees have invested. In addition, certain of our executive officers have from time to time invested their personal funds directly, or directed that funds for which they act in a fiduciary capacity be invested, in funds arranged by Citi’s subsidiaries on the same terms and conditions as the other outside investors in these funds, who are not our executive officers, or employees. Other than certain “grandfathered” investments, in accordance with Sarbanes-Oxley and the Citi Corporate Governance Guidelines, executive officers may invest in certain Citi-sponsored investment opportunities only under certain circumstances and with the approval of the appropriate committee. In 2018, there were no distributions from the funds that require disclosure.

In 2018, Citi performed corporate banking and securities brokerage services in the ordinary course of our business for certain organizations in which some of our Directors are officers or directors. In addition, in the ordinary course of business, Citi may use the products or services of organizations in which some of our Directors are officers or directors.

The persons listed on page 98 of this Proxy Statement are the current members of the Personnel and Compensation Committee. No current or former member of the Personnel and Compensation Committee was a part of a “compensation committee interlock” during fiscal year 2018 as described under SEC rules. In addition, none of our executive officers served as a director or member of the compensation committee of another entity that would constitute a “compensation committee interlock.” No member of the Personnel and Compensation Committee had any material interest in a transaction with Citi or is a current or former officer of Citi, and no member of the Personnel and Compensation Committee is a current employee of Citi or any of its subsidiaries. In addition, no member of the Board, or any immediate family member of the Board, engaged FW Cook for any compensation-related services in 2018.

Mr. Corbat has entered into an Aircraft Time Sharing Agreement with Citigroup Inc. that allows him to reimburse Citi for the cost of his personal use of corporate aircraft based on the aggregate incremental cost of the flight to Citi. Aggregate incremental cost is calculated based on a cost-per-flight-hour charge developed by a nationally recognized and independent service or, if higher, the charge allowed under Federal Aviation Regulation 91.501(d). Mr. Corbat reimbursed Citi $223,132 related to his personal use of corporate aircraft during 2018.

An adult child of Mr. Humer, a Director, has been employed by Citi since 2010 and is currently employed by Citi’s Institutional Clients Group. He received 2018 compensation of $951,239. A sibling of Sara Wechter, the Head of Human Resources, has been employed by Citi since 2008, first as an intern and then, beginning in 2010, as a full-time employee. She is employed by the Consumer Banking Group and received 2018 compensation of $479,139. An adult child of John Gerspach, Citi’s former CFO, has been employed by Citi since 2009 and is currently employed in Citi’s Compliance Group. He received 2018 compensation of $154,765. The compensation for these employees was established by Citi in accordance with its employment and compensation practices applicable to employees with equivalent qualifications and responsibilities and holding similar positions. These individuals do not have an interest in the employment relationship of, nor do they share a household with, their respective family members who are employees of Citi.

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Indebtedness

Other than certain “grandfathered” margin loans, in accordance with Sarbanes-Oxley and the Citi Corporate Governance Guidelines, no margin loans may be made to any executive officer unless such person is an employee of a broker-dealer subsidiary of Citi and such loan is made in the ordinary course of business.

Certain transactions in excess of $120,000 involving loans, deposits, credit cards, and sales of commercial paper, certificates of deposit, and other money market instruments and certain other banking transactions occurred during 2018 between Citibank, N.A. and other Citi banking subsidiaries on the one hand, and certain Directors or executive officers of Citi, members of their immediate families, corporations or organizations of which any of them is an executive officer or partner or of which any of them is the beneficial owner of 10% or more of any class of securities, or associates of the Directors, the executive officers or their family members, on the other. The transactions were made in the ordinary course of business on substantially the same terms, including interest rates and collateral, that prevailed at the time for comparable transactions with other persons not related to the lender and did not involve more than the normal risk of collectability or present other unfavorable features. Personal loans made to any Director or an executive officer must comply with Sarbanes-Oxley, Regulation O, and the Corporate Governance Guidelines, and must be made in the ordinary course of business.

Business Practices Committees

The business practices committees, which are composed of our most senior executives, provide the guidance necessary for Citi's business practices to meet the highest standards of professionalism, integrity, and ethical behavior consistent with Citi’s Mission and Value Proposition. The business practices committees for the corporate level and each of Citi’s businesses and regions review business activities, transactions, sales practices, product design, potential conflicts of interest, and other franchise or reputational risk issues escalated to these committees.

Business practices concerns may be raised through a variety of sources, including business practices working groups, other in-business committees, or the control functions. Relevant issues from the business practices committees are reported on a regular basis to the Nomination, Governance and Public Affairs Committee of the Board.

Ethics and Culture

At Citi, our mission is to serve as a trusted partner to our clients by responsibly providing financial services that enable growth and economic progress.

We foster a culture of ethics through our governance framework, programs and efforts that embed our culture and expectations for behavior throughout the organization, and collaboration with key stakeholders outside Citi to improve Citi’s and the banking industry’s culture.

Governance over Culture

The cornerstone of our approach to culture is our governance framework, which begins with a strong “tone from the top” starting with the Citigroup Board of Directors. In 2014, Citi’s Board established a standing Ethics and Culture Committee of the Board to oversee senior management’s ongoing efforts to foster a culture of ethics throughout Citi. For more information, please see the Ethics and Culture Committee Charter, which is set forth on Citi’s website at www.citigroup.com.

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With oversight from the Ethics and Culture Committee, senior management has undertaken a number of efforts in support of Citi’s culture, including developing Citi’s Mission and Value Proposition and Leadership Standards. On an ongoing basis, the Ethics and Culture Committee remains responsible for overseeing senior management’s efforts to reinforce and enhance a culture of ethics within Citi, which includes:

Overseeing efforts to enhance and communicate Citi’s Mission and Value Proposition, evaluating management’s progress, and providing feedback on these efforts;
Reviewing and assessing Citi’s culture to determine if further enhancements are needed to foster ethical decision-making by employees and overseeing efforts to support ethical decision-making by employees; and
Reviewing Citi’s Code of Conduct and Code of Ethics for Financial Professionals.

Programs and Efforts that Embed Culture

To promote ethical conduct and enhance Citi’s culture, Citi focuses on empowering individuals by establishing global policies, programs, and processes that embed our values throughout the organization and guide and support our employees in making ethical decisions and adhering to Citi’s standards of conduct. Under the oversight of and with input and feedback from the Ethics and Culture Committee, senior management has prioritized a number of efforts to further embed our values and conduct expectations into the organization. The following are a few examples of our programs and associated efforts to set, reinforce, and embed our culture at Citi:

Communications and awareness efforts concerning our Mission and Value Proposition, including Citi-wide videos from senior management articulating our core principles and providing examples of these principles in action.
Embedding the Leadership Standards into key aspects of our employee life cycle, such as hiring and performance reviews.
Training of employees on key culture-related themes, including on our Code of Conduct, ethical decision-making, and the importance of leadership.

Code of Ethics for Financial Professionals

The Citi Code of Ethics for Financial Professionals applies to Citi’s Chief Executive Officer (Principal Executive Officer), Chief Financial Officer (Principal Financial Officer), Controller (Principal Accounting Officer), and all finance professionals and administrative staff in a finance role, including Controllers, Finance & Risk Shared Services, Finance and Risk Infrastructure, Financial Planning & Analysis and Strategy, Treasury, Tax, M&A, Investor Relations, and the Regional/Business teams. Citi expects all of its employees to act in accordance with the highest standards of personal and professional integrity in all aspects of their activities, to comply with all applicable laws, rules, and regulations, to deter wrongdoing, and abide by the Citi Code of Conduct and other policies and procedures adopted by Citi that govern the conduct of its employees. The Code of Ethics for Financial Professionals is intended to supplement the Citi Code of Conduct. A copy of the Code of Ethics for Financial Professionals is available on our website at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Code of Ethics for Financial Professionals.” We will disclose amendments to, or waivers from, the Code of Ethics for Financial Professionals, if any, on our website.

Ethics Hotline

Citi expects employees to raise concerns or questions regarding ethics, discrimination or harassment matters, and to promptly report suspected violations of law, regulation, rule, or breaches of Citi policy, procedure, standard, or the Citi Code of Conduct. Citi offers several channels by which employees and others may report ethical concerns, including concerns about accounting, internal controls, or auditing matters. We provide a global Ethics Hotline, a toll-free number that is available 24 hours a day, seven days a week, 365 days a year, and is staffed by live operators who can connect to translators to accommodate multiple languages.

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42 CORPORATE GOVERNANCE

Calls to the Ethics Hotline are received by a third-party vendor, located in the United States, which reports the calls to the Citi Ethics Office for handling. Ethical concerns may also be reported through a dedicated e-mail address, multilingual website submission, fax line, and conventional mailing address. Any individual may also raise a concern by accessing Citi’s public-facing corporate website. Individuals may choose to remain anonymous to the extent permitted by applicable laws and regulations. We prohibit retaliatory actions against anyone who raises concerns or questions in good faith, or who participates in a subsequent investigation of such concerns. The Ethics Office reports on concerns it receives via the Citi Ethics Hotline to the Audit Committees of the Board of Directors of Citigroup Inc. and Citibank, N.A. on a quarterly basis.

Code of Conduct

The Board has adopted a Code of Conduct, which provides an overview of the laws, regulations, and Citi policies and procedures applicable to the activities of Citi, and sets forth Citi’s Mission and Value Proposition, as well as the standards of ethics and professional behavior expected of employees and representatives of Citi. The Code of Conduct applies to every director, officer, and employee of Citi and its consolidated subsidiaries. All Citi employees, directors, and officers are required to read and comply with the Code of Conduct. In addition, other persons performing services for Citi may be subject to the Code of Conduct by contract or other agreement. The Code of Conduct is publicly available in multiple languages at www.citigroup.com. Click on “About Us,” then “Corporate Governance,” and then “Code of Conduct.”

Communications with the Board

Stockholders or other interested parties who wish to communicate with a member or members of the Board, including the Chair or the non-management Directors as a group, may do so by addressing their correspondence to the Board member or members, c/o the Corporate Secretary, Rohan Weerasinghe, Citigroup Inc., 388 Greenwich Street, New York, NY 10013. The Board of Directors has approved a process pursuant to which the office of the Corporate Secretary will review and forward correspondence to the appropriate person or persons for response.

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Stock Ownership

Citi has long encouraged stock ownership by its Directors, officers, and employees to align their interests with the long-term interests of stockholders. The Board and executive officers are subject to a stock ownership commitment, which requires these individuals to maintain a minimum ownership level of Citigroup stock. Executive officers are required to retain at least 75% of the equity awarded to them as incentive compensation (net of amounts required to pay taxes and option exercise prices) as long as they are executive officers. In addition, a stock holding period applies after the executive officer leaves Citi, or is no longer an executive officer. He or she must retain, for one year after ending executive officer status, 50% of the shares previously subject to the stock ownership commitment. Directors are similarly required to retain at least 75% of the net equity awarded to them, further aligning their interests with stockholders. The Board may revise the terms of the stock ownership commitment from time to time to reflect legal and business developments warranting a change. In addition, Directors and executive officers may not enter into hedging transactions in respect of Citi’s common stock or other securities issued by Citi, including securities granted by the Company to the Director or executive officer as part of his or her compensation and securities purchased or acquired by the Director or executive officer in a non-compensatory transaction.

The following table shows the beneficial ownership of Citi common stock by our Directors, nominee, named executive officers, current CFO, and Directors and executive officers as a group at February 23, 2019. For purposes of this table, “beneficial ownership” is determined in accordance with Rule 13d-3 under the Exchange Act, pursuant to which a person, or group of persons, is deemed to have “beneficial ownership” of any shares of common stock that such person has the right to acquire within 60 days of the date of determination.

BENEFICIAL OWNERSHIP TABLE

Name       Common
Stock
Beneficially
Owned
Excluding
Options(1)
      Options
Exercisable
Within
60 days
      Owned by
or Tenant in
Common with
Family Member,
Trust, or
Mutual Fund(2)
      Total
Beneficial
Ownership(3)
Receipt
Deferred(4)
      Total
Ownership(5)
Stephen Bird 170,674 95,000 265,674 120,952 386,626
Michael L. Corbat 325,778 1,781 327,559 273,968 601,527
Ellen M. Costello 15,885 15,885 2,402 18,287
Barbara J. Desoer 44,754 44,754 80,222 124,976
John D. Dugan 2,516 2,516 2,402 4,918
James A. Forese 361,856 361,856 221,764 583,620
Jane Nind Fraser 37,687 37,687 99,297 136,984
John Gerspach* 152,183 125,601 277,784 125,878 403,662
Duncan P. Hennes 15,624 15,624 2,402 18,026
Peter B. Henry 18,287 18,287 2,402 20,689
Franz B. Humer 23,206 23,206 600 23,806
S. Leslie Ireland 2,566 2,566 2,402 4,968
Lew W. (Jay) Jacobs, IV 1,037 1,179 2,216 2,402 4,618
Renée J. James 8,926 8,926 2,402 11,328
Mark Mason** 276 276 60,928 61,204
Eugene M. McQuade 126,279 3,098 129,377 2,402 131,779
Gary M. Reiner 28,544 28,544 2,402 30,946
Anthony M. Santomero 38,159 38,159 600 38,759
Diana L. Taylor 31,619 31,619 2,402 34,021
James S. Turley 16,750 16,750 2,402 19,152
Deborah C. Wright 4,693 4,693 2,402 7,095
Ernesto Zedillo Ponce de Leon 30,209 30,209 2,402 32,611
Total (29 Directors and
Executive Officers
as a group) 1,663,290 422,513 2,085,803 1,424,879 3,510,682

* Retired as Chief Financial Officer on February 22, 2019.
** Chief Financial Officer as of February 23, 2019.

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44 STOCK OWNERSHIP

(1) The stock reported for certain Directors in this column includes deferred common stock, which is fully vested and which the Director or Directors have the right to acquire within 60 days.
(2) Stock held as a tenant-in-common with a family member or trust, owned by a family member, held by a trust for which the Director or executive officer is a trustee but not a beneficiary, or held by a mutual fund which invests substantially all of its assets in Citi common stock.
(3) At February 23, 2019, no Director or executive officer beneficially owned more than 1% of Citi’s outstanding common stock. At February 23, 2019, all of the Directors and executive officers as a group beneficially owned approximately 0.09% of Citi’s common stock.
(4) Amounts represent Directors’ deferred common stock. The deferred common stock becomes distributable approximately on the second anniversary of the date of grant; however, if a Director retired or resigned from the Board during the year when the award was granted, the Director would forfeit a pro rata portion of the award. Amounts also represent, as applicable, unvested shares of executive officers.
(5) Total Ownership reflects the amount represented in the Section 16 filings of the relevant Director or executive officer.

Mr. Reiner also owns 485 depositary shares of Citi’s 5.9% Fixed Rate/Floating Rate Noncumulative Preferred Stock, Series B, which represents 0.065% of such series of preferred stock.

OWNERS OF MORE THAN 5% OF CITI COMMON STOCK

Name and Address of Beneficial Owner       Beneficial Ownership       Percent of Class
BlackRock, Inc.(a)
55 East 52nd Street, New York, NY 10055 172,569,709 7.1%
The Vanguard Group, Inc.(b)
100 Vanguard Blvd., Malvern, PA 19355 179,143,858 7.33%

(a) Based on the Schedule 13G filed with the SEC on February 11, 2019 by BlackRock, Inc. and certain subsidiaries, BlackRock reported that it had sole voting power over 150,855,815 shares and had sole dispositive power over 172,569,709 shares. The Schedule 13G states that the shares are beneficially owned by funds and accounts managed by BlackRock and any economic interests of the securities covered are held by BlackRock for the benefit of the funds and accounts and not for BlackRock’s own account.
(b) Based on the Schedule 13G filed with the SEC on February 11, 2019 by Vanguard and certain subsidiaries, Vanguard reported that it had sole voting power over 2,870,416 shares; sole dispositive power over 175,778,663 shares; shared voting power over 558,273 shares; and shared dispositive power over 3,365,195 shares. Vanguard Fiduciary Trust Company, a wholly owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 2,071,666 shares or .08% of Citi’s common stock as a result of its serving as investment manager of collective trust accounts. In addition, Vanguard Investments Australia, Ltd., a wholly owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 2,062,626 shares or .08% of Citi’s common stock as a result of its serving as investment manager of Australian investment offerings.

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Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires Citi’s Section 16 officers and Directors, and persons who own more than 10% of a registered class of Citi’s equity securities, to file reports of ownership and changes in ownership with the SEC and the NYSE, and to furnish Citi with copies of the forms. Based on its review of the forms it received, or written representations from reporting persons, Citi believes that, during 2018, each of its Section 16 officers and Directors complied with all such filing requirements.

Proposal 1: Election of Directors

The Board has nominated all of the current Directors for re-election at the 2019 Annual Meeting, except for Mr. Humer and Mr. Santomero, who will not stand for re-election to the Board having reached the retirement age under Citi’s Corporate Governance Guidelines. Directors are not eligible to stand for re-election after reaching the age of 72. Mr. O’Neill retired from the Board on January 1, 2019 having reached the retirement age. Mr. Santomero will retire from the Board on April 1, 2019 and Mr. Humer will retire from the Board on April 16, 2019. Mr. Jacobs was elected by the Board in June 2018. Mr. Jacobs was identified as a potential Director by Egon Zehnder, the Board’s nominating consultant and by a retired Board member. In addition, the Board has nominated Ms. Desoer for election to the Board at the 2019 Annual Meeting. Ms. Desoer was recommended as a candidate for election to the Citigroup Board by her fellow directors on the Citibank Board, all of whom are members of Citi’s Board. If elected, each nominee will hold office until the 2020 Annual Meeting or until his or her successor is elected and qualified.

Director Criteria and Nomination Process

The Nomination, Governance and Public Affairs Committee considers all qualified candidates identified by members of the Nomination, Governance and Public Affairs Committee, by other members of the Board, by senior management, and by security holders. During 2018, the Committee engaged Egon Zehnder to assist in identifying and evaluating potential nominees. Stockholders who would like to propose a Director candidate for consideration by the Nomination, Governance and Public Affairs Committee may do so by submitting the candidate’s name, résumé, and biographical information to the attention of the Corporate Secretary, Rohan Weerasinghe, Citigroup Inc., 388 Greenwich Street, New York, New York 10013. All proposals for nominations received by the Corporate Secretary will be presented to the Committee for its consideration.

In considering the composition of the Board of Directors, the Nomination, Governance and Public Affairs Committee inventories the categories of risks faced by Citi, given its size, business mix, and geographical presence, and seeks to identify candidates with the skills and experience necessary to enable the Board of Directors to provide proper oversight of those risks. The Nomination, Governance and Public Affairs Committee also takes Director tenure into consideration when making Director nomination decisions and believes that it is desirable to maintain a mix of longer-tenured, experienced Directors and newer Directors with fresh perspectives. The Nomination, Governance and Public Affairs Committee and the Board also believe that longer-tenured, experienced Directors are a significant strength of the Board, given the large size of our Company, the breadth of our product offerings, and the international scope of our organization. The Board’s composition, and the individuals nominated for consideration by stockholders, are the result of careful consideration by the Committee of the correspondence between the risk inventory and skills and experience of the Board members and candidates. In addition to the ability

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46 PROPOSAL 1: ELECTION OF DIRECTORS

to assist the Board in its oversight of a particular risk or risks, as more fully described in each nominee’s biography, the members of the Board are assessed based on a variety of factors, including the following criteria, which have been developed by the Nomination, Governance and Public Affairs Committee and approved by the Board:

Whether the candidate has exhibited behavior that indicates he or she is committed to the highest ethical standards;
Whether the candidate has had business, governmental, non-profit or professional experience at the chair, chief executive officer, chief operating officer, or equivalent policy-making and operational level of a large organization with significant international activities across many regulatory jurisdictions and regions that indicates that the candidate will be able to make a meaningful and immediate contribution to the Board’s discussion of and decision-making on the array of complex issues facing a large financial services business that operates on a global scale;
Whether the candidate has special skills, expertise and background that would complement the attributes of the existing Directors, taking into consideration the diverse communities and geographies in which the Company operates;
Whether the candidate has the financial expertise required to provide effective oversight of a diversified financial services business that operates on a global scale;
Whether the candidate has achieved prominence in his or her business, governmental, or professional activities and has built a reputation that demonstrates the ability to make the kind of important and sensitive judgments that the Board is called upon to make;
Whether the candidate will effectively, consistently, and appropriately take into account and balance the legitimate interests and concerns of all of the Company’s stockholders and other stakeholders in reaching decisions, rather than advancing the interests of a particular constituency;
Whether the candidate possesses a willingness to challenge management while working constructively as part of a team in an environment of collegiality and trust; and
Whether the candidate will be able to devote sufficient time and energy to the performance of his or her duties as a Director.

Application of these factors involves the exercise of judgment by the Nomination, Governance and Public Affairs Committee and the Board.

Based on its assessment of each candidate’s independence, skills and qualifications and the criteria described above, the Nomination, Governance and Public Affairs Committee will make recommendations regarding potential Director candidates to the Board.

The Nomination, Governance and Public Affairs Committee follows the same process and uses the same criteria for evaluating candidates proposed by stockholders, members of the Board of Directors, and members of senior management. For the 2019 Annual Meeting, Citi did not receive notice from any stockholders regarding a nomination to the Board of Directors.

Director Qualifications

The nominees for the Board of Directors each have the qualifications and experience to approve and guide Citi’s strategy and to oversee management’s execution of that strategic vision. Citi’s Board of Directors consists of individuals with the skills, experience, and backgrounds necessary to oversee Citi’s efforts toward becoming a simpler, smaller, safer, and stronger financial institution, while mitigating risk and operating within a complex financial and regulatory environment.

The nominees listed below are leaders in business, the financial community, and academia because of their intellectual acumen and analytic skills, strategic vision, ability to lead and inspire others to work with them, and records of outstanding accomplishments over a period of decades. Each has been chosen to stand for election in part because of his or her ability and willingness to ask difficult questions, understand Citi’s unique challenges, and evaluate the strategies proposed by management, as well as their implementation.

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Each of the nominees has a long record of professional integrity, a dedication to his or her profession and community, a strong work ethic that includes a commitment to coming fully prepared to meetings and being willing to spend the time and effort needed to fulfill professional obligations and the ability to maintain a collegial environment.

Many of our nominees are either current or former chief executive officers or chairs of other large international corporations or have experience operating large, complex academic or governmental departments. As such, they have a deep understanding of, and extensive experience in, many of the areas that are outlined below as being of critical importance to Citi’s proper operation and success. For the purposes of its analysis, the Board has determined that nominees who have served as a chief executive officer or a chair of a major corporation or large, complex institution have extensive experience with financial statement preparation, compensation determinations, regulatory compliance (if their businesses are or were regulated), corporate governance, public affairs, and legal matters.

In evaluating the composition of the Board, the Nomination, Governance and Public Affairs Committee seeks to find and retain individuals who, in addition to having the qualifications set forth in Citi’s Corporate Governance Guidelines, have the skills, experience and abilities necessary to meet Citi’s unique needs as a highly regulated financial services company with operations in the corporate and consumer businesses within the United States and more than 100 countries around the globe. The Committee has determined it is critically important to Citi’s proper operation and success that its Board has, in addition to the qualities described above, expertise and experience in the following areas:

     

Citi’s Personnel and Compensation Committee is responsible for determining the compensation of the CEO and approving the compensation of other executive officers of the Company and members of Citi’s Operating Committee. In order to properly carry out its responsibilities with respect to compensation, Citi’s Board must include members who have experience evaluating the structure of compensation for senior executives. They must understand the various forms of compensation that can be utilized, the purpose of each type and how various elements of compensation can be used to motivate and reward executives and drive performance, while not encouraging imprudent risk-taking or simply having short-term goals.

     

With more than 200 million customer accounts, Citi provides services to its retail customers in connection with its retail banking, private banking, credit cards, real estate lending, personal loans, investment services, small- and middle-market commercial banking, and other financial services. Citi looks to its Board members with extensive consumer experience to assist it in evaluating its business model and strategies for reaching and servicing its retail customers domestically and around the world. Citi is a global diversified bank whose businesses provide a broad range of financial services to consumer and institutional customers, making it critically important that its Board include members who have deep financial services backgrounds.

     

Citi’s reputation is a vital asset in building trust with its clients and other stakeholders, and Citi makes every effort to communicate its corporate values to its stockholders and clients, its achievements in the areas of corporate social responsibility, sustainability, and philanthropy, and its efforts to improve the communities in which we live and work. Members of the Board with experience in the areas of corporate affairs, philanthropy, community development, communications, and corporate social responsibility assist management by reviewing Citi’s policies and programs that relate to significant public issues, including environmental, social and governance factors, as well as by reviewing Citi’s relationships with external stakeholders and issues that impact Citi’s reputation.

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Citi aspires to the highest standards of corporate governance and ethical conduct: doing what we say, reporting results with accuracy and transparency, and maintaining compliance with the laws, rules, and regulations that govern the Company’s businesses. The Board is responsible for shaping corporate governance policies and practices, including adopting the corporate governance guidelines applicable to the Company and monitoring the Company’s compliance with governance policies and the guidelines. To carry out these responsibilities, the Board must include experienced leaders in the area of corporate governance who must be familiar with governance issues, the constituencies most interested in those issues, and the impact that governance policies have on the functioning of a company.

     

Citi’s internal controls over financial reporting are designed to ensure that Citi’s financial reporting and its financial statements are prepared in accordance with generally accepted accounting principles. While the Board and its committees are not responsible for preparing our financial statements, they have oversight responsibility, including the selection of outside independent auditors, subject to stockholder ratification, and lead engagement partner. The Board must include members with direct or supervisory experience in the preparation of financial statements, as well as finance, audit, and accounting expertise.

     

Citi provides a wide variety of services to its corporate clients, including strategic and financial advisory services, such as mergers, acquisitions, financial restructurings, loans, foreign exchange, cash management, underwriting and distributing equity, and debt and equity derivative services, markets and securities services, retail structured products, liquidity management, treasury and trade solutions and securities and fund services. With a corporate business as extensive and complex as Citi’s, it is crucial that members of the Board have the depth of understanding and experience necessary to guide management’s conduct of these lines of business.

     

As a company with a broad international reach, Citi’s Board values the perspectives of Directors with international business or governmental experience or expertise in global economics. Citi’s presence in markets outside the United States is an important competitive advantage for Citi, because it allows us to serve U.S. and foreign businesses and individual clients whose activities span the globe. Directors with international business experience can use the experience that they have developed through their own business dealings to assist Citi’s Board and management in understanding and successfully navigating the business, political, and regulatory environments in countries in which Citi does or seeks to do business. Directors with global economics expertise can help guide Citi management in understanding the challenges faced by other markets and in developing its global strategy.

     

In addition to the regulatory supervision described below, Citi is subject to myriad laws and regulations and is party to legal actions and regulatory proceedings from time to time. Citi’s Board has an important oversight function with respect to compliance with applicable requirements, monitors the progress of legal proceedings, and evaluates major settlements. Citi’s Board must include members with experience in regulatory compliance, as well as an understanding of complex litigation and litigation strategies.

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Citi has a long history as a technology innovator—Citibank, N.A. was one of the first banks to offer automatic teller machines for its customers during the 1970s. Since then, Citi has continued to leverage new technologies to deliver enhanced products and services to its clients and customers such as online banking, mobile and tablet banking, and mobile check deposit. In addition, Citi deploys new technology and platform innovations to gather, process, analyze, and provide information to execute transactions and meet the needs of its clients and customers. In this context, Citi must be able to access reliable data to ensure that it complies with regulatory requirements, including anti-money laundering and sanctions, and to meet other information security and control objectives. Citi must ensure that its operations are efficient and there is a continuous focus on enhancing productivity to meet its operational and strategic goals. The Board must include members who have knowledge and experience in technology, including such technology-centric issues as cybersecurity, data privacy and data management, and the changing supervisory and regulatory technology landscape. Members of the Board must be qualified to provide oversight of the development and maintenance of Citi’s technology platforms; Citi’s compliance with regulatory requirements; Citi’s operational efficiency and productivity strategies; the operations and reliability of Citi’s systems; and the protection of client and customer data.

     

Citi and its subsidiaries are regulated and supervised by numerous regulatory agencies, both domestically and internationally, including in the U.S. the Federal Reserve Board, the Office of the Comptroller of the Currency, the FDIC, the Consumer Financial Protection Bureau, and state banking and insurance departments, as well as international financial services authorities. Having Directors with experience interacting with regulators or operating businesses subject to extensive regulation is important to furthering Citi’s continued compliance with its many regulatory requirements and fostering productive relationships with its regulators. Several of Citi’s Board members have experience with ethics and compliance and building an effective, values-based ethics and compliance program.

     

Risk management is a critical function of a complex global financial services company and its proper supervision requires Board members with sophisticated risk management skills and experience. Directors provide oversight of the Company’s risk management framework, including the significant policies, procedures, and practices used in managing credit, market, and certain other risks, including liquidity, capital, and balance sheet risks, as well as capital markets risks, and review recommendations by management regarding risk mitigation. Given increased cybersecurity threats, Citi’s Board must have members who have sufficient experience to enable them to oversee management’s efforts to monitor, detect and prevent cyber threats to Citi. Citi’s Board must include members with risk expertise to assist Citi in its efforts to properly identify, measure, monitor, report, analyze, and control or mitigate risk.

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50 PROPOSAL 1: ELECTION OF DIRECTORS

The Nominees

The following tables give information – provided by the nominees – about their principal occupation, business experience, and other matters.

Each nominee’s biography highlights his or her particular skills, qualifications, and experience that support the conclusion of the Nomination, Governance and Public Affairs Committee that the nominee is extremely qualified to serve on Citi’s Board.

Board Recommendation

The Board of Directors recommends that you vote FOR each of the following nominees.

   

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Michael L. Corbat
Age: 58

Director of Citigroup
since 2012

Other Directorships:
None

Previous Directorships within the last five years:
None

Other Activities:
The Clearing House Association (Chairman of the Supervisory Board), Financial Services Forum (Vice Chairman), Bank Policy Institute (Permanent Board Member), The Partnership for New York City (Executive Committee Member), The Business Council (Member), Business Roundtable (Member), International Business Council of WEF (Member), and The U.S. Ski & Snowboard Team Foundation (Trustee)

Chief Executive Officer
Citigroup Inc.
Chief Executive Officer, Citigroup Inc. – October 2012 to Present
Chief Executive Officer, Europe, Middle East, and Africa – December 2011 to October 2012
Chief Executive Officer, Citi Holdings – January 2009 to December 2011
Chief Executive Officer, Citi’s Global Wealth Management – September 2008 to January 2009
Head of Global Corporate Bank and Global Commercial Bank – March 2008 to September 2008
Head of Global Corporate Bank – April 2007 to March 2008
Head of Global Relationship Bank – March 2004 to April 2007
Head of EM Sales & Trading and Capital Markets, FICC – October 2001 to March 2004
Head of EM Sales & Fixed Income Origination – March 1988 to October 2001
Skills and Qualifications
Mr. Corbat is an experienced financial services executive and finance professional, and has been nominated to serve on the Board because of his extensive experience and expertise in the areas of Financial Services, Risk Management, Financial Reporting, Institutional Business, Corporate and Consumer Businesses, Regulatory and Compliance, and Corporate Affairs. In his role as Chief Executive Officer of Citigroup Inc., his prior position as Citi’s CEO of Europe, Middle East, and Africa, and his extensive career at Citi he has gained experience in all of Citi’s business operations, including consumer banking, corporate and investment banking, securities and trading, and private banking services. In these roles, Mr. Corbat has gained extensive financial services, financial reporting, corporate business, and risk management experience. Additionally, in his role as CEO of Citi Holdings, Citi’s portfolio of non-core businesses and assets, he oversaw the divestiture of more than 40 businesses, including the IPO and sale of Citi’s remaining stake in Primerica. Mr. Corbat also successfully oversaw the restructuring of Citi’s consumer finance and retail partner cards businesses and divested more than $500 billion in assets, reducing risk on the Company’s balance sheet and freeing up capital to invest in Citi’s core banking business.
Primary Qualifications
Financial Reporting
Institutional Business
Regulatory and Compliance
Risk Management

Citi 2019 Proxy Statement


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS 51

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Ellen M. Costello
Age: 64

Director of Citigroup
since 2016

Director of Citibank, N.A.
since 2016

Other Directorships:
Diebold Nixdorf, Inc.

Previous Directorships within the last five years:
DH Corporation

Other Activities:
Chicago Council on Global Affairs (Board) and The Economic Club of Chicago (Member)

Former President, Chief Executive Officer, BMO Financial Corporation and
Former U.S. Country Head, BMO Financial Group
President and CEO, BMO Financial Corporation and U.S. Country Head, BMO Financial Group – 2011 to 2013
Group Head, Personal and Commercial Banking, U.S. and President and Chief Executive Officer, BMO Harris Bank N.A., BMO Financial Group – 2006 to 2011
Vice Chairman and Head, Securitization and Credit Investment Management, Merchant Banking and Head of N.Y. Office, Capital Markets Group, BMO Financial Group – 2000 to 2006
Executive Vice President, Strategic Initiatives, Capital Markets Group, BMO Financial Group – 2000
Executive Vice President and Head, Global Treasury Group, BMO Financial Group –1997 to 1999
Senior Vice President and Deputy Treasurer, Global Treasury Group, BMO Financial Group – 1995 to 1997
Managing Director and Regional Treasurer, Asia Pacific, Global Treasury Group, BMO Financial Group – 1993 to 1994
Managing Director and Head, North American Financial Product Sales, Global Treasury Group, BMO Financial Group – 1991 to 1993
Skills and Qualifications
Ms. Costello is an accomplished financial services executive and through her prominent roles in the areas of Financial Services, Risk Management, Institutional and Consumer Businesses, Financial Reporting, Operations and Technology, and Regulatory and Compliance, has been nominated to serve on the Board. Because Citi is an international financial services company with both consumer and institutional businesses, having former banking executives with extensive banking experience, like Ms. Costello, as Board members enables the Board to provide knowledgeable oversight to its business and regulatory activities. In her 30 years at BMO Financial Group, a global financial institution, Ms. Costello acquired extensive experience in personal and commercial banking, wealth management and capital markets businesses in Canada, Asia, and the U.S. In her roles in Global Treasury and Global Capital Markets, she gained experience in corporate, institutional and investment banking, securities, trading and asset management. As CEO of BMO Harris Bank N.A., Ms. Costello gained experience in personal and commercial banking, strategic planning, marketing, regulatory compliance, financial reporting, and personnel matters. Additionally, as CEO of BMO Financial Corporation and U.S. Country Head of BMO Financial Group, she gained further experience in regulatory compliance, including capital and resolution planning, risk management, and governance. Her prior board service at DH Corporation and her current board service at Diebold Nixdorf provide her with experience in global operations and financial technologies businesses. Ms. Costello’s extensive financial services background also adds significant value to Citi’s and Citibank’s relationships with various regulators and stakeholders.
Primary Qualifications
Consumer Business and Financial Services
Financial Reporting
Operations and Technology
Risk Management

www.citigroup.com


Table of Contents

52 PROPOSAL 1: ELECTION OF DIRECTORS

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Barbara J. Desoer
Age: 66

New Nominee

Other Directorships:
DaVita Inc.

Previous Directorships within the last five years:
None

Other Activities:
Board of Visitors of the University of California, Berkeley (Member)

Chief Executive Officer, Citibank, N.A.*
Chief Executive Officer, Citibank, N.A. – April 2014 to April 2019
Chief Operating Officer, Citibank, N.A. – October 2013 to April 2014
President, Bank of America Home Loans, Bank of America – 2008 to 2012
Global Technology & Operations Executive, Bank of America – 2004 to 2008
Skills and Qualifications
Ms. Desoer has been nominated to serve on the Board because of her significant insight into the financial services industry, including client services, and extensive expertise in financial management, risk management and the management of regulatory issues at large financial institutions. She has over 40 years of large bank experience, as the CEO of Citibank, N.A. for five years and a 35-year career at Bank of America, serving in such roles as the President of Bank of America Home Loans and as a Global Technology & Operations Executive. Ms. Desoer’s knowledge of and experience in the financial services industries qualifies her to serve on Citi’s Board. Her primary qualifications are in the following areas: Consumer Business and Financial Services through her roles at Citibank, N.A. and Bank of America; Operations and Technology experience while serving as a Global Technology & Operations Executive at the Bank of America where she enabled growth and innovation through technology; Regulatory and Compliance through her service as the CEO of Citibank, N.A. and previously as the head of Citi’s Anti-Money Laundering Program; and Risk Management through her oversight of Citi’s Comprehensive Capital Analysis and Review Process and serving on Citibank’s Risk Management Committee. Ms. Desoer will be a significant asset to Citi’s Board because of her expertise in financial regulation, leadership in the operations of a large global financial institution, and technology and management expertise.
Primary Qualifications
Consumer Business and Financial Services
Operations and Technology
Regulatory and Compliance
Risk Management

* Ms. Desoer will retire as CEO of Citibank, N.A. before the Annual Meeting.

Citi 2019 Proxy Statement


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS 53

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

John C. Dugan
Age: 63

Director of Citigroup
since 2017

Other Directorships:
None

Previous Directorships within the last five years:
None

Other Activities:
University of Michigan, “Michigan in Washington” program (Advisory Board)

Chair
Citigroup Inc.
Chair, Citigroup Inc. – January 2019 to Present
Director, Citigroup Inc. – October 2017 to Present
Partner and Chair, Financial Institutions Group, Covington & Burling LLP – 2011 to 2017
Comptroller of the Currency – 2005 to 2010
Partner (1995 to 2005) and Of Counsel (1993 to 1995), Covington & Burling LLP
Assistant Secretary for Domestic Finance and Deputy Assistant Secretary for Financial Institutions Policy, U.S. Department of the Treasury – 1989 to 1993
Minority General Counsel and Counsel for the U.S. Senate Committee on Banking, Housing, and Urban Affairs – 1985 to 1989
Skills and Qualifications
Mr. Dugan is an experienced former banking regulator and former law firm partner and has been nominated to serve on the Board because of his extensive skills and knowledge in the areas of Risk Management, Financial Services, Legal Matters, Corporate Governance, and Regulatory and Compliance. Because Citi operates in a highly regulated industry, having Board members like Mr. Dugan, with valuable expertise and perspective in regulatory, legal, and compliance matters, is vital to enhancing the Board’s oversight of the Company. During his tenure as Comptroller of the Currency, Mr. Dugan led the agency through the financial crisis and the ensuing recession that resulted in numerous regulatory, supervisory, and legislative actions for national banks. As a former partner at Covington & Burling LLP, Mr. Dugan advised financial institution clients, including boards of directors, on a range of issues arising from increased regulatory requirements resulting from the financial crisis, including the implementation of the Dodd-Frank Act. In the international arena, Mr. Dugan developed important expertise and insights from serving on the Basel Committee on Banking Supervision as it formulated the “Basel III” regulatory standards; chairing the Joint Forum of banking, securities, and insurance supervisors; performing an active role at the Financial Stability Board; and serving as a member of the Global Advisory Board of Mitsubishi UFJ Financial Group, Inc. Mr. Dugan also developed valuable perspective on accounting issues from his five years of service as Trustee of the Financial Accounting Foundation, which oversees the Financial Accounting Standards Board and the Government Accounting Standards Board.
Primary Qualifications
Corporate Governance
Legal Matters
Regulatory and Compliance
Risk Management

www.citigroup.com


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54 PROPOSAL 1: ELECTION OF DIRECTORS

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Duncan P. Hennes
Age: 62

Director of Citigroup
since 2013

Director of Citibank, N.A.
since 2013

Other Directorships:
RenaissanceRe Holdings Ltd.

Previous Directorships within the last five years:
Syncora Holdings, Ltd.

Other Activities:
Freeman & Co.
(Advisory Board)

Co-Founder and Partner
Atrevida Partners, LLC
Co-Founder and Partner, Atrevida Partners, LLC – June 2007 to Present
Co-Founder and Partner, Promontory Financial Group – 2000 to 2006
Chief Executive Officer, Soros Fund Management – 1999 to 2000
Executive Vice President/Treasurer, Bankers Trust Corporation – 1987 to 1999
Audit Manager, Arthur Andersen & Co. – 1979 to 1987
Skills and Qualifications
Mr. Hennes is an experienced financial services professional and has been nominated to serve on the Board because of his considerable expertise in the areas of Compensation, Financial Services, Risk Management, Financial Reporting, Institutional Business, and Regulatory and Compliance. Because Citi is an international financial services company with a significant institutional business and a need to ensure proper risk management, having an executive, like Mr. Hennes, with extensive institutional and risk management experience, enables the Board to provide knowledgeable oversight of its institutional business and its risk management function. In his role as the Co-Founder of Atrevida Partners, LLC and his prior experience at Promontory Financial Group and Bankers Trust Corporation, Mr. Hennes has developed wide-ranging skills and experience in financial services, regulatory compliance, corporate and investment banking, and securities and trading. While at Bankers Trust Corporation, Mr. Hennes was Chairman of Oversight Partners I, the consortium of 14 firms that participated in the equity recapitalization of Long-Term Capital Management. As the Chairman of Oversight Partners I, Mr. Hennes gained experience in credit and risk management, and personnel matters. In his capacity as CEO of Soros Fund Management, Mr. Hennes gained experience in investing, operational infrastructure, and trading, including arbitrage activities. Mr. Hennes’s experience as a Certified Public Accountant has also given him audit, financial reporting, and risk management expertise.
Primary Qualifications
Compensation
Institutional Business
Regulatory and Compliance
Risk Management

Citi 2019 Proxy Statement


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS 55

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Peter B. Henry
Age: 49

Director of Citigroup
since 2015

Other Directorships:
Nike, Inc.

Previous Directorships within the last five years:
General Electric Company, Kraft Foods Inc. and Kraft Foods Group, Inc. (split into two companies in October 2012)

Other Activities:
British-American Business Council, National Bureau of Economic Research (Board), The Economic Club of New York (Board), and Federal Reserve Bank of New York (Economic Advisory Panel)

Dean Emeritus and W. R. Berkley Professor of Economics and Finance
New York University, Leonard N. Stern School of Business
Dean Emeritus and W. R. Berkley Professor of Economics and Finance, New York University, Leonard N. Stern School of Business – December 2017 to Present
Dean, New York University, Leonard N. Stern School of Business – January 2010 to December 2017
Faculty Member, Stanford University – 1997 to 2009
Fellow, National Science Foundation – 1993 to 1996
Skills and Qualifications
Mr. Henry, a leading academic and seasoned international economist, has been nominated to serve on the Board because of his extensive expertise in the areas of International Business or Economics, Financial Services, Risk Management, Financial Reporting, Institutional Business, and Corporate Governance. As a renowned international economist, he shares important perspectives with the Board on emerging markets, which is a focus of Citi’s strategy. The experience he gained in his role as Dean of the Leonard N. Stern School of Business enables him to provide an important perspective to the Board’s discussions on public affairs, financial, and operational matters. As a member of the Board of Nike, Inc. and its Corporate Responsibility and Sustainability and Governance Committees, Mr. Henry has gained valuable insights about the consumer business environment, sustainability issues, and governance. Mr. Henry’s governmental advisory roles, including leadership of President Obama’s Transition Team’s review of international lending agencies and his service as an economic advisor to governments in developing and emerging markets, have given him valuable insights and perspectives on international business and financial services. Mr. Henry brings to the Board valuable insight in executive leadership at a large private university, including a robust understanding of the issues facing companies and governments in both mature and emerging markets around the world.
Primary Qualifications
Corporate Governance
Financial Reporting
Institutional Business
International Business or Economics

www.citigroup.com


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56 PROPOSAL 1: ELECTION OF DIRECTORS

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

S. Leslie Ireland
Age: 59

Director of Citigroup
since 2017

Director of Citibank, N.A.
since 2017

Other Directorships:
None

Previous Directorships within the last five years:
None

Other Activities:
Intelligence and National Security Alliance (INSA) (Vice-Chair of the Financial Threats Council) and The Stimson Center (Board)

Former Assistant Secretary for Intelligence and Analysis, U.S. Department of
the Treasury, and National Intelligence Manager for Threat Finance, Office of the
Director of National Intelligence
Head of the Office of Intelligence and Analysis, U.S. Department of the Treasury – 2010 to 2016
National Intelligence Manager for Threat Finance – 2010 to 2016
President’s Daily Intelligence Briefer – 2008 to 2010
Iran Mission Manager – 2005 to 2008
Executive Advisor to the Director and Deputy Director on Central Intelligence, CIA – 2004 to 2005
Various Leadership, Staff and Analytical positions (classified), CIA – 1985 to 2003
Skills and Qualifications
Ms. Ireland, former Assistant Secretary for Intelligence and Analysis for the U.S. Department of the Treasury and National Intelligence Manager for Threat Finance, brings to Citi significant knowledge and expertise from her career in financial intelligence and cybersecurity, both in the U.S. and internationally. Ms. Ireland has been nominated to serve on the Board because of her experience in the areas of Institutional Business, International Business or Economics, Operations and Technology, Regulatory and Compliance, and Risk Management. During her service to the U.S. Government, Ms. Ireland provided global economic and financial intelligence, developed and strengthened infrastructure to protect U.S. national security, and advised and oversaw financial intelligence processes. Ms. Ireland is able to offer insight and perspective to Citi’s Board on financial threats faced by organizations in the public and private sectors, including cybersecurity and money laundering. Ms. Ireland’s expertise in protecting IT systems from internal and external cybersecurity threats, and setting and evaluating organizational risks, helps enhance the Board’s oversight of cybersecurity and risk management practices.
Primary Qualifications
Institutional Business
International Business or Economics
Operations and Technology
Risk Management

Citi 2019 Proxy Statement


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS 57

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Lew W. (Jay) Jacobs, IV
Age: 48

Director of Citigroup
since 2018

Other Directorships:
None

Previous Directorships within the last five years:
None

Other Activities:
The Peterson Institute for International Economics (Board Member), Commercial Trust Company (Board Member), Georgetown University (Fellow), and Washington University (Trustee)

Former President and Managing Director; Pacific Investment Management Company LLC (PIMCO)
President and Managing Director; Executive Committee Member, Compensation Committee Member, Global Risk Committee Chair, PIMCO – 2014 to 2017
President (non-executive), Commercial Trust Company – 1998 to Present
Managing Director and Global Head of Human Resources, PIMCO – 2008 to 2014
Managing Director and Head of Fixed Income – Germany, PIMCO – 2006 to 2008
Executive Vice President and Head of Fixed Income – Germany, PIMCO – 2003 to 2006
Executive Vice President (2003), Senior Vice President (2001 to 2003), Vice President (2000 to 2001), and Associate (1998 to 2000), Office of the CEO, PIMCO – 1998 to 2003
Skills and Qualifications
Mr. Jacobs is an experienced financial services professional and has been nominated to serve on the Board because of his considerable expertise in the areas of Human Resources, Compensation, Financial Reporting, Institutional Business, and Risk Management. Citi is an international financial services company with a significant institutional business and a large diverse workforce and Mr. Jacobs, with extensive human resources experience, enhances the Board’s ability to provide knowledgeable oversight of one of its most important elements, its employees. He has been responsible for overseeing and managing executive teams and a sizeable worldwide workforce, developing and marketing of fixed-income products, and aligning financial and strategic initiatives. As a result of this experience, Mr. Jacobs brings to our Board an understanding of the global financial services industry; experience in providing insight and guidance in overseeing executive management, including executive compensation; and oversight of the challenges and risks facing large companies with complex global operations. Mr. Jacobs’ finance expertise enables him to provide a critical perspective on operational and financial aspects of the Company, including accounting and corporate finance matters.
Primary Qualifications
Compensation
Financial Reporting
Institutional Business
Risk Management

www.citigroup.com


Table of Contents

58 PROPOSAL 1: ELECTION OF DIRECTORS

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Renée J. James
Age: 54

Director of Citigroup
since 2016

Other Directorships:
Oracle Corporation, Sabre Corporation and Vodafone Group Plc

Previous Directorships within the last five years:
VMware, Inc.

Other Activities:
President’s National Security Telecommunications Advisory Committee (Chair) and University of Oregon (Trustee)

Chair and CEO, Ampere Computing, and Operating Executive,
The Carlyle Group
Chair and CEO, Ampere Computing – February 2018 to Present
Operating Executive, The Carlyle Group – February 2016 to Present
President, Intel Corporation – 2014 to 2016
Executive Vice President and Head, Group GM Intel Software and Services Business – 2004 to 2013
Group Vice President and Division General Manager, Sales and Marketing; Group and General Manager, Microsoft Program Office, Intel – 2001 to 2004
Division Chief Operating Officer, Intel Online Solutions – 1999 to 2001
Chief of Staff to Intel Chairman and CEO Andrew Grove – 1995 to 1999
Skills and Qualifications
Ms. James is a seasoned technology leader with large-scale, broad international operations experience. An accomplished operational executive, Ms. James has been nominated to serve on the Board because of her expertise in the areas of Technology, Risk Management, and International and Consumer Businesses. She is an accomplished technology executive with wide-ranging international experience managing large-scale, complex global operations. Through her 28-year career as a technology executive at Intel and in her current role as Chair and CEO of Ampere Computing, a private technology company, and her role as Operating Executive with the Media and Technology Practice at The Carlyle Group, as well as in her role as the Chair of the National Security Telecommunications Advisory Committee to the President of the United States, Ms. James developed extensive expertise in cybersecurity and emerging technologies. These skills are particularly important to Citi as a member of an industry facing cyber threats and as a company embracing innovation and new technologies. Through her career at Intel and her service on the boards of other prominent international companies (Oracle Corporation, Sabre Corporation, and Vodafone Group Plc), Ms. James has had executive experience with consumer risk management and corporate governance issues.
Primary Qualifications
Consumer Business and Financial Services
International Business or Economics
Operations and Technology
Risk Management

Citi 2019 Proxy Statement


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS 59

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Eugene M. McQuade
Age: 70

Director of Citigroup Inc.
since 2015

Director of Citibank, N.A.
since 2009

Other Directorships:
None

Previous Directorships within the last five years:
XL Group, Ltd. (Chairman)

Other Activities:
Promontory Financial Group (Vice Chairman), a subsidiary of IBM, Boys and Girls Clubs of America (Governor), American Ireland Fund (Director), and Catholic Charities of New York (Chairman)

Former Vice Chairman, Citigroup Inc. and
Former Chief Executive Officer, Citibank, N.A.
Vice Chairman, Citigroup Inc. – 2014 to May 2015
Chief Executive Officer, Citibank, N.A. – July 2009 to April 2014
Vice Chairman and President, Merrill Lynch Bank – 2008 to 2009
President and Chief Operating Officer, Freddie Mac – 2004 to 2007
President, Bank of America – 2004
President and Chief Operating Officer, FleetBoston Financial – 2002 to 2004
Vice Chairman and Chief Financial Officer, FleetBoston Financial – 1997 to 2002
Skills and Qualifications
Mr. McQuade is an experienced financial services executive and has been nominated to serve on the Board because of his extensive skills and experience in the areas of Financial Services, Risk Management, Institutional and Consumer Businesses, Financial Reporting, Legal Matters, and Regulatory and Compliance. As the former Chief Executive Officer of Citibank, N.A., he has a deep understanding of all aspects of Citi’s institutional and consumer businesses and has managed Citibank’s capital structure, regulatory compliance, enterprise risk, and strategic planning. While a member of management, he provided oversight of Citi’s CCAR process, which enables him to significantly enhance the Board and the Risk Management Committee’s oversight of this process. Mr. McQuade has acquired valuable financial services knowledge and expertise through his service in management positions such as CEO, president, vice chairman, chief financial officer, and chief operating officer of several global, publicly traded financial institutions. He has developed broad experience in consumer banking and commercial banking through his previous experience at Bank of America, FleetBoston Financial, and Merrill Lynch. In addition, his prior board service at XL Group, Ltd. gives him greater insight into the oversight of global operations and regulated businesses. Mr. McQuade’s extensive financial services background also adds significant value to Citi’s and Citibank’s relationships with various regulators and stakeholders.
Primary Qualifications
Consumer Business and Financial Services
Institutional Business
Regulatory and Compliance
Risk Management

www.citigroup.com


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60 PROPOSAL 1: ELECTION OF DIRECTORS

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Gary M. Reiner
Age: 64

Director of Citigroup
since 2013

Other Directorships:
Hewlett Packard Enterprise Company and Box Inc.

Previous Directorships within the last five years:
None

Other Activities:
None

Operating Partner
General Atlantic LLC
Operating Partner, General Atlantic LLC – September 2010 to Present
Senior Vice President and Chief Information Officer, General Electric Company – 1996 to 2010
Partner, Boston Consulting Group – 1986 to 1991
Skills and Qualifications
Mr. Reiner is an experienced executive and has been nominated to serve on the Board because of his experience in the areas of Operations and Technology, Financial Reporting, Compensation, Corporate Governance, and International and Consumer Businesses. In his current role as Operating Partner of General Atlantic LLC, he has continued to broaden his considerable expertise in technology and management. Through his tenure as Chief Information Officer at General Electric, Mr. Reiner gained extensive experience in the management of a large, complex, multinational operation, developing technology innovations, strategic planning, and marketing to an international consumer and institutional customer base. He also has significant knowledge and insight in information technology through his many years of service as a partner of Boston Consulting Group, where he focused on strategic issues for technology businesses and in advising on cybersecurity issues. Mr. Reiner’s expertise as an innovative technology leader assists Citi in meeting the operational, technology, and cybersecurity challenges inherent in operating a financial services company in the 21st century. Through his service on the Hewlett Packard Board of Directors, Mr. Reiner has developed additional leadership and corporate governance expertise as the Chair of its Nominating, Governance and Social Responsibility Committee.
Primary Qualifications
Compensation
Consumer Business and Financial Services
International Business or Economics
Operations and Technology

Citi 2019 Proxy Statement


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS 61

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Diana L. Taylor
Age: 64

Director of Citigroup
since 2009

Other Directorships:
Brookfield Asset Management and Sotheby’s

Previous Directorships within the last five years:
Brookfield Office Properties

Other Activities:
Accion (Chair), Columbia Business School (Board of Overseers), Girls Educational & Mentoring Services (GEMS) (Member), Hudson River Park Trust (Chair), Friends of Hudson River Park, Ideas42, International Women’s Health Coalition, Mailman School of Public Health (Board of Overseers), The After School Corporation (Member), The Economic Club of New York, Council on Foreign Relations (Member), and Hot Bread Kitchen (Board Chair)

Former Superintendent of Banks, State of New York
Vice Chair, Solera Capital LLC – July 2014 to 2018
Managing Director, Wolfensohn Fund Management, L.P. – 2007 to 2014
Superintendent of Banks, State of New York – 2003 to 2007
Deputy Secretary, Governor Pataki, State of New York – 2002 to 2003
Chief Financial Officer, Long Island Power Authority – 2001 to 2002
Vice President, KeySpan Energy – 1999 to 2001
Assistant Secretary, Governor Pataki, State of New York – 1996 to 1999
Executive Vice President, Muriel Siebert & Company – 1993 to 1994
President, M.R. Beal & Company – 1988 to 1993 and 1995 to 1996
Skills and Qualifications
Ms. Taylor is an experienced financial services executive and regulator and has been nominated to serve on the Board because of her wide-ranging experience in the areas of Financial Services, Institutional Business, Regulatory and Compliance, Risk Management, Corporate Affairs, Compensation, Corporate Governance, and Legal Matters. Citi’s Board provides oversight of Citi’s banking businesses and regulatory relationship, areas where Ms. Taylor is highly skilled; it also provides oversight of Citi’s compensation programs and governance, including public affairs matters, where Ms. Taylor is able to use her valuable perspective to enhance the Board’s oversight. Ms. Taylor has broad bank regulatory and risk management experience, having served as the Superintendent of Banks for the New York State Banking Department. Her financial services and corporate business experience includes in-depth private equity, fund management, and investment banking experience as a Vice Chair at Solera Capital LLC and as a Managing Director of Wolfensohn Fund Management, L.P., a fund manager; and Founding Partner and President of M.R. Beal & Company, a full-service investment banking firm. Ms. Taylor also served as Chief Financial Officer of the Long Island Power Authority. In addition, through her work on the Sotheby’s Compensation Committee, the Brookfield Properties Governance Committee, as chair of Accion and the Hudson River Park Trust, and former chair of the New York Women’s Foundation and the YMCA of Greater New York, Ms. Taylor has gained additional knowledge in corporate affairs, corporate governance, financial reporting, compensation, and legal matters.
Primary Qualifications
Compensation
Corporate Affairs
Corporate Governance
Regulatory and Compliance

www.citigroup.com


Table of Contents

62 PROPOSAL 1: ELECTION OF DIRECTORS

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

James S. Turley
Age: 63

Director of Citigroup
since 2013

Director of Citibank, N.A.
since 2013

Other Directorships:
Emerson Electric Co., Intrexon Corporation and Northrop Grumman Corporation

Previous Directorships within the last five years:
None

Other Activities:
Boy Scouts of America (Chairman), Boy Scouts of Greater St. Louis (Board Member), World Scout Foundation (Board Member), Theatre Forward (Board Member), Municipal Theatre Association of St. Louis (Board Member), and Forest Park Forever (Board Member)

Former Chairman and CEO
Ernst & Young
Chairman and CEO, Ernst & Young – 2001 to June 2013
Regional Managing Partner, Ernst & Young – 1994 to 2001
Skills and Qualifications
Mr. Turley, the retired Global Chair and CEO of Ernst & Young, brings to Citi his insights and expertise from his exceptional career in the accounting profession, both in the U.S. and internationally, as well as his executive experience from leading a major public accounting firm. Mr. Turley has been nominated to serve on the Board because of his extensive knowledge and expertise in the areas of Financial Reporting, Legal Matters, Corporate Affairs, International Business, Regulatory and Compliance, and Risk Management. As Chair of the Audit Committee and a member of the Risk Management Committee, Mr. Turley adds significant value to the Board’s oversight of financial reporting, regulatory matters, compliance, internal audit, legal issues, and risk. Having served as Chair and CEO of Ernst & Young, he has developed significant expertise in the areas of compensation, litigation, and corporate affairs. Mr. Turley, the former Chairman of the Board of Catalyst, is recognized as a champion of diversity, having received the prestigious Crystal Leadership Award for his support of equal marketplace access for women and the groundbreaking programs he oversaw at Ernst & Young that enable the strategic development of women-owned businesses, and provides guidance to Citi on diversity matters as well.
Primary Qualifications
Financial Reporting
International Business or Economics
Regulatory and Compliance
Risk Management

Citi 2019 Proxy Statement


Table of Contents

PROPOSAL 1: ELECTION OF DIRECTORS 63

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Deborah C. Wright
Age: 61

Director of Citigroup
since 2017

Other Directorships:
None

Previous Directorships within the last five years:
Carver Bancorp, Inc., Time Warner Inc. and Voya Financial, Inc.

Other Activities:
None

Managing Director of U.S. Jobs and Economic Opportunity Rockefeller Foundation

Managing Director, Rockefeller Foundation – 2018 to Present
Chairman, Carver Bancorp, Inc. – 2005 to 2016
President and Chief Executive Officer of Carver Bancorp, Inc. and Carver Federal Savings Bank – 1999 to 2014
President and Chief Executive Officer of the Upper Manhattan Empowerment Zone Development Corporation, a redevelopment fund – 1996 to 1999
Commissioner of the Department of Housing Preservation and Development – 1994 to 1996
Member of the New York City Housing Authority Board – 1992 to 1994, and served on the New York City Planning Commission – 1990 to 1992
Skills and Qualifications
Ms. Wright is an experienced financial services executive and through her prominent roles in the areas of Financial Services, Consumer Business, Risk Management, Corporate Affairs, Financial Reporting, and Regulatory and Compliance, has been nominated to serve on the Board. As a highly regulated financial services company with an extensive consumer business and a commitment to community development, Citi benefits from having Directors, like Ms. Wright, with distinguished careers in financial services and who are knowledgeable about, and committed to, community development. Ms. Wright’s experience as the former Chairman and Chief Executive Officer of Carver Bancorp, Inc. and Carver Federal Savings Bank, where she acquired significant experience in personal and commercial banking, strategic planning, marketing, regulatory compliance, financial reporting, and personnel matters, brings leadership qualities to Citi and demonstrates a practical understanding of organizations, processes, strategy, and risk management. She has valuable insight into corporate affairs through her current role as a Managing Director of U.S. Jobs and Economic Opportunity at The Rockefeller Foundation. Ms. Wright has also developed financial reporting experience as former Chair of the Audit and Finance Committee at Time Warner Inc. As a former board member of Voya Financial, Inc., and through her prior long-term service as a director of Kraft Foods Inc., she also brings the perspective and in-depth knowledge of overseeing firms that provide a wide variety of consumer products to customers.
Primary Qualifications
Consumer Business and Financial Services
Financial Reporting
Regulatory and Compliance
Risk Management

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64 PROPOSAL 1: ELECTION OF DIRECTORS

Name and Age at
Record Date

Position, Principal Occupation, Business Experience and Directorships

Ernesto Zedillo
Ponce de Leon
Age: 67

Director of Citigroup
since 2010

Other Directorships:
Alcoa Corp. and Procter & Gamble Company

Previous Directorships within the last five years:
Grupo Prisa

Other Activities:
BP (Member of International Advisory Board), Credit Suisse Research Institute (Advisor), The Group of Thirty (Member), Natural Resource Governance Institute (Chair of the Board), and Presidential Counselor of Laureate International Universities

Director, Center for the Study of Globalization and Professor in the Field of
International Economics and Politics, Yale University
Director, Center for the Study of Globalization and Professor in the Field of International Economics and Politics, Yale University – September 2002 to Present
President of Mexico – 1994 to 2000
Secretary of Education, Government of Mexico – 1992 to 1993
Secretary of Economic Programming and the Budget, Government of Mexico – 1988 to 1992
Undersecretary of the Budget, Government of Mexico – 1987 to 1988
Banco de México – Economist, Deputy Manager of Economic Research, Director General of FICORCA, Deputy Director – 1978 to 1987
Skills and Qualifications
Mr. Zedillo Ponce de Leon is the former President of Mexico, a seasoned economist, and an academic. He has been nominated to serve on the Board because of his extensive experience in the areas of International Business or Economics, Corporate Affairs, Risk Management, and Corporate Governance. As a financial services company with a significant business in Mexico, Citi benefits from having Mr. Zedillo Ponce de Leon on its Board to provide a greater understanding of the business, governmental, regulatory, and economic environment in Mexico. Through his extensive governmental experience, including his service from 1978 to 1987 at the Central Bank of Mexico, as Undersecretary of the Budget for the Mexican government from 1987 to 1988, as Secretary of Economic Programming and the Budget from 1988 to 1992, and as President of Mexico from 1994 to 2000, as well as his academic experience, including his roles as the Director of the Center for the Study of Globalization, Professor of International Economics and Politics and Professor of International and Area Studies at Yale, he has had extensive experience in the areas of international business, regulatory compliance, and risk management. His service as Chair of the Global Development Network, Chair of the High Level Commission on Modernization of World Bank Group Governance, on the Group of Thirty, and on the International Advisory Boards of BP and the Coca-Cola Company, has given him extensive international business and corporate affairs experience. Mr. Zedillo Ponce de Leon has gained experience in risk management, corporate governance, and corporate affairs as a member of the Board of Alcoa Corp., serving on the Audit Committee and Public Issues Committee; at Procter & Gamble Company, as a member of the Governance and Public Responsibility Committee; as a member of the Innovation and Technology Committee, Grupo Prisa of Spain; as a past Director of the Union Pacific Corporation, where he served on the Audit and Finance Committees; as a past Director of EDS, where he served on the Governance Committee; and as Director of Grupo Prisa of Spain until November 2017, where he served as Chair of the Governance Committee.
Primary Qualifications
Corporate Affairs
Corporate Governance
International Business or Economics
Risk Management

Citi 2019 Proxy Statement


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PROPOSAL 1: ELECTION OF DIRECTORS 65

Directors’ Compensation

The key objectives of our Director Compensation Program are to attract qualified talent, provide pay that is commensurate with the substantial time commitment associated with service, and to foster commonality of interest between Board members and our stockholders.

Directors’ compensation is determined by the Board and the Nomination, Governance and Public Affairs Committee makes recommendations to the Board based on periodic benchmarking assessments and advice received from FW Cook, its independent advisor. In making recommendations to the Board, the Committee considers the competitive positioning of the aggregate and individual components of compensation, as well as the mix of pay and structure versus both direct competitors and other comparable organizations. The Committee also considers the unique skill set required to serve on our Board and the intense time commitment associated with preparation for and attendance at meetings of the Board and its committees as well as external commitments, such as engagement with our stockholders and regulators. Since our initial public offering in 1986, Citi has paid outside Directors all or a portion of their compensation in common stock to ensure that the Directors have an ownership interest in common with other stockholders.

In 2018, FW Cook provided benchmarking assessments and advice on peer and broad market practices. After considering the assessments and advice as well as the factors described above, the Committee determined that the current Director Compensation Program payment structure was appropriate.

Annual Cash Retainer and Deferred Stock Award

 

Non-employee Directors receive an annual cash retainer of $75,000 and a deferred stock award valued at $150,000. The deferred stock award is generally granted on the same date that annual incentives are granted to the senior executives. The deferred stock award generally becomes distributable on the second anniversary of the date of the grant, and Directors may elect to defer receipt of the award beyond that date. In the event a Director leaves the Board voluntarily prior to the conclusion of the two-year deferral period and before attaining age 72, the deferred stock award will be pro-rated based on the number of calendar quarters the Director served. Directors may elect to receive all or a portion of their cash retainer in the form of common stock, and Directors may elect to defer receipt of this common stock.


Fees for Service on Citi’s Board Committees, Citibank’s Board, and other Board Service

 
A Citi Director who serves as Chair of the Audit Committee, Personnel and Compensation Committee or Risk Management Committee is entitled to an annual $50,000 Committee Chair Fee per committee. A Director who serves as Chair of any other Committee is entitled to an annual $35,000 Committee Chair Fee per committee. A Citi Director who serves as a member of the Audit Committee, Personnel and Compensation Committee, or Risk Management Committee is entitled to an annual $30,000 Committee Fee per committee. A Citi Director who serves as a member of any other Committee (excluding the Executive Committee and the Preferred Stock Committee) is entitled to an annual $15,000 Committee Fee per committee. Directors are permitted to receive all or a part of their Committee Fee(s) and Committee Chair Fee(s) in common stock.
Mses. Costello and Ireland and Messrs. Hennes, McQuade, Santomero, and Turley serve on Citibank’s Board of Directors. Each non-employee Director of Citibank is entitled to receive $25,000 as an annual cash retainer. The Chair of Citibank’s Board is entitled to an annual $50,000 Chair Fee.
Citi reimburses its Board members for expenses incurred in attending Board and Committee meetings or performing other services for Citi in their capacities as Directors. Such expenses include food, lodging, and transportation.
All Annual Retainers, Committee Fees, and Committee Chair Fees for Citi and Citibank are paid in four equal quarterly installments per annum. These fees are reported in the Non-Employee Director Compensation Table on page 67.
Ms. Taylor serves on the Board of Citigroup Global Markets Limited, an international subsidiary Board of Citi.

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66 PROPOSAL 1: ELECTION OF DIRECTORS

Chair Compensation

Citi’s Chair receives annual compensation in the form of a $500,000 Chair Fee, the amount of which was set by the Board in 2012 in recognition of the significant commitment of time and energy required to serve as Citi’s Chair. This Fee is in addition to the Retainer and the Deferred Stock Award payable to all Directors, as well as any relevant Committee Chair and/or Committee Fees. Throughout his term as Chair, Mr. O’Neill, our prior Chair, waived receipt of any compensation other than the Chair Fee, which was payable 75% in deferred shares of Citi common stock and 25% in cash or deferred shares of Citi common stock. The three elements of Chair compensation for our new Chair, Mr. Dugan – the Chair Fee, the Retainer and Deferred Stock Award, and Committee Fees – remain unchanged from prior practice except regarding the mix of cash and equity in the Chair Fee; specifically, beginning in 2019, the Chair Fee is payable 50% in deferred shares of Citi’s common stock and 50% in cash or deferred shares of Citi’s common stock. Mr. Dugan has agreed to accept the first two elements of Chair compensation, which consist of the Chair Fee of $500,000 and the Retainer and Deferred Stock Award of $225,000 that all Directors receive. However, while Mr. Dugan will actively participate in the four Board Committees of which he is a member – Audit; Nomination, Governance and Public Affairs; Personnel and Compensation; and Risk Management – and will attend as many meetings of Citi’s other Committees as is feasible, he has determined to waive the Committee Fees to which he is otherwise entitled. His total annual compensation therefore is $725,000, which the Board believes is appropriate in reflection of the evolving role of the Chair and the virtually full-time nature of the Chair’s responsibilities. In reaching this conclusion, the Board considered many factors including Mr. Dugan’s extensive experience and knowledge of the regulatory environment, the expected time commitment attributable to both internal and external responsibilities, and the compensation paid for similar roles among direct competitors, including U.S. and non-U.S. banks as well as other high-profile global organizations.


What We Do What We Don’t Do
Citi’s Director Compensation Program is primarily equity based.
Directors have a robust Stock Ownership Commitment.
Subject to approval by stockholders at the Annual Meeting, Citi’s 2019 Stock Incentive Plan provides that the maximum number of shares subject to awards to an individual Director in a calendar year, taken together with any cash fees paid during the calendar year to the Director for services as a member of the Board, may not exceed $1 million in value. While the Board may approve a higher limit for the non-Executive Chair, as noted above, amounts to be paid to the Chair are substantially below the $1 million cap.
  
Directors who are employees of Citi or its subsidiaries do not receive any compensation for their services as Directors.
Directors are not paid Meeting Fees.
Citi does not offer a Retirement Program for its Directors.
Directors are not permitted to hedge or pledge their Citi common stock.

Citi 2019 Proxy Statement


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PROPOSAL 1: ELECTION OF DIRECTORS 67

The following table provides information on 2018 compensation for non-employee Directors:

2018 DIRECTOR COMPENSATION

Name       Fees Earned or
Paid in Cash
($)(1)
      Stock
Awards
($)(2)
      Total
($)
Ellen M. Costello          $ 171,250  $ 150,000  $ 321,250
John C. Dugan $ 165,000 $ 150,000 $ 315,000
Duncan P. Hennes $ 260,000 $ 150,000 $ 410,000
Peter B. Henry $ 146,250 $ 150,000 $ 296,250
Franz B. Humer $ 170,000 $ 150,000 $ 320,000
S. Leslie Ireland $ 130,000 $ 150,000 $ 280,000
Lew W. Jacobs, IV $ 75,000 $ 75,000 $ 150,000
Renée J. James $ 135,000 $ 150,000 $ 285,000
Eugene M. McQuade $ 180,000 $ 150,000 $ 330,000
Michael E. O’Neill(3) $ 500,000 $ 500,000
Gary M. Reiner $ 155,000 $ 150,000 $ 305,000
Anthony M. Santomero $ 260,000 $ 150,000 $ 410,000
Diana L. Taylor $ 220,000 $ 150,000 $ 370,000
James S. Turley $ 260,000 $ 150,000 $ 410,000
Deborah C. Wright $ 135,000 $ 150,000 $ 285,000
Ernesto Zedillo Ponce de Leon $ 135,000 $ 150,000 $ 285,000
 
(1) Directors may elect to receive all or a portion of the cash retainer in the form of Citi common stock and may elect to defer receipt of Citi common stock. Certain Directors elected to defer receipt of the shares. Ms. Costello and Mr. Henry elected to receive all of their Citigroup 2018 cash retainer and Committee Fees in deferred stock as represented in the chart below. Mr. O’Neill elected to receive his entire Chair Fee in deferred stock as represented in the chart below. Messrs. Jacobs and Reiner elected to receive their cash retainers in stock (100%), but did not elect to defer receipt of their retainers; therefore, their 1,179 and 2,310 shares, respectively, were distributed to them quarterly on January 1, April 1, July 1, and October 1. The price used to determine the number of shares awarded was the average consolidated NYSE closing price of Citigroup common stock for the first 10 days of the last month of the quarter.
 
Name       Fees Paid
Currently in Cash
($)
      Deferred Fees
to Be Paid in Stock
Number of
Units
      Value of
Units
Ellen M. Costello              $ 25,000 2,186  $ 146,250
John C. Dugan $ 165,000
Duncan P. Hennes $ 260,000
Peter B. Henry 2,186 $ 146,250
Franz B. Humer $ 170,000
S. Leslie Ireland $ 130,000
Lew W. Jacobs, IV
Renée J. James $ 135,000
Eugene M. McQuade $ 180,000
Michael E. O’Neill 7,458 $ 500,000
Gary M. Reiner
Anthony M. Santomero $ 260,000
Diana L. Taylor $ 220,000
James S. Turley $ 260,000
Deborah C. Wright $ 135,000
Ernesto Zedillo Ponce de Leon $ 135,000

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68 PROPOSAL 1: ELECTION OF DIRECTORS

(2) The values in this column represent the aggregate grant date fair values of the 2018 Deferred Stock Awards. The grant date fair value is based on a grant date of February 15, 2018 and a grant price determined by the average NYSE closing prices of Citi’s common stock on the immediately preceding five trading days. The amounts in the chart below represent Deferred Stock Awards only and not shares awarded in lieu of the cash retainer and/or Chair or Committee Chair Fees. The grant date fair value of the Deferred Stock Awards is set forth below:
 
Director       Deferred Stock
Granted in 2018
(#)
      Grant Date
Fair Value
($)
Ellen M. Costello 2,015    $ 150,000
John C. Dugan 2,015 $ 150,000
Duncan P. Hennes 2,015 $ 150,000
Peter B. Henry 2,015 $ 150,000
Franz B. Humer 2,015 $ 150,000
S. Leslie Ireland 2,015 $ 150,000
Lew W. Jacobs, IV* 1,028 $ 75,000
Renée J. James 2,015 $ 150,000
Eugene M. McQuade 2,015 $ 150,000
Michael E. O’Neill
Gary M. Reiner 2,015 $ 150,000
Anthony M. Santomero 2,015 $ 150,000
Diana L. Taylor 2,015 $ 150,000
James S. Turley 2,015 $ 150,000
Deborah C. Wright 2,015 $ 150,000
Ernesto Zedillo Ponce de Leon 2,015 $ 150,000
 
* The Deferred Stock Award granted to Mr. Jacobs was prorated based on the date he commenced service on Citi’s Board.
 
(3) Mr. O’Neill received an annual Chair Fee of $500,000 for his service as Citi’s Chair. He elected to waive all other fees in relation to his service as a Director or Committee member.

The aggregate number of shares of deferred stock outstanding for each Director at the end of 2018 was:

Name       Number of
Shares
Ellen M. Costello 15,884
John C. Dugan 2,515
Duncan P. Hennes 15,212
Peter B. Henry 15,971
Franz B. Humer 23,206
S. Leslie Ireland 2,565
Lew W. Jacobs, IV 1,036
Renée J. James 8,925
Eugene M. McQuade 8,613
Michael E. O’Neill 89,987
Gary M. Reiner 4,564
Anthony M. Santomero 38,159
Diana L. Taylor 31,618
James S. Turley 15,212
Deborah C. Wright 4,692
Ernesto Zedillo Ponce de Leon 30,208

Citi 2019 Proxy Statement


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  69

Audit Committee Report

The Audit Committee (“Committee”) operates under a charter that specifies the scope of the Committee’s responsibilities and how it carries out those responsibilities.

The Board of Directors has determined that all seven members of the Committee are independent based upon the standards adopted by the Board, which incorporate the independence requirements under applicable laws, rules and regulations.

Management is responsible for the financial reporting process, the system of internal controls, including internal control over financial reporting, risk management and procedures designed to ensure compliance with accounting standards and applicable laws and regulations. KPMG LLP, Citigroup’s independent registered public accounting firm (“independent auditors”) is responsible for the integrated audit of the consolidated financial statements and internal control over financial reporting. The Committee’s responsibility is to monitor and oversee these processes and procedures. The members of the Committee are not professionally engaged in the practice of accounting or auditing and are not professionals in these fields. The Committee relies, without independent verification, on the information provided to us and on the representations made by management regarding the effectiveness of internal control over financial reporting, that the financial statements have been prepared with integrity and objectivity and that such financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. The Committee also relies on the opinions of the independent auditors on the consolidated financial statements and the effectiveness of internal control over financial reporting.

The Committee’s meetings facilitate communication among the members of the Committee, management, the internal auditors, and Citigroup’s independent auditors. The Committee separately met with each of the internal and independent auditors with and without management, to discuss the results of their examinations and their observations and recommendations regarding Citigroup’s internal controls. The Committee also discussed with Citigroup’s independent auditors all communications required by PCAOB Auditing Standard Nos. 1301 and 2410.

The Committee reviewed and discussed the audited consolidated financial statements of Citigroup as of and for the year ended December 31, 2018 with management, the internal auditors, and Citigroup’s independent auditors.

The Committee has received the written disclosures required by PCAOB Rule 3526 - “Communication with Audit Committees Concerning Independence.” The Committee discussed with the independent auditors any relationships that may have an impact on their objectivity and independence and satisfied itself as to the auditors’ independence.

The Committee has reviewed and approved the amount of fees paid to the independent auditors for audit, audit related and tax compliance and other services. The Committee concluded that the provision of services by the independent auditors did not impair their independence.

Based on the above-mentioned review and discussions, and subject to the limitations on our role and responsibilities described above and in the Committee charter, the Committee recommended to the Board that Citigroup’s audited consolidated financial statements be included in Citigroup’s Annual Report on Form 10-K for the year ended December 31, 2018 for filing with the SEC.

The Audit Committee:

James S. Turley (Chair)
Ellen M. Costello
John C. Dugan
Peter B. Henry
Lew W. (Jay) Jacobs, IV
Anthony M. Santomero
Deborah C. Wright

Dated: March 5, 2019

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Proposal 2: Ratification of Selection of Independent Registered Public Accounting Firm

The Audit Committee has selected KPMG LLP (KPMG) as the independent registered public accounting firm of Citi for 2019. KPMG has served as the independent registered public accounting firm of Citi and its predecessors since 1969.

Arrangements have been made for representatives of KPMG to attend the 2019 Annual Meeting. The representatives will have the opportunity to make a statement, if they desire to do so, and will be available to respond to appropriate stockholder questions.

Disclosure of Independent Registered Public Accounting Firm Fees

The following is a description of the fees earned by KPMG for services rendered to Citi for the years ended December 31, 2018 and 2017:

2018 2017
(in millions of dollars)
Audit Fees             $ 64.2               $ 64.7
Audit-Related Fees $ 24.5 $ 22.8
Tax Fees $ 10.1 $ 10.3
All Other Fees $ 0.0 $ 0.0
Total Fees $ 98.8 $ 97.8

Audit Fees

This includes fees earned by KPMG in connection with the annual integrated audits of Citi’s consolidated financial statements and internal control over financial reporting under Sarbanes-Oxley Section 404, audits of subsidiary financial statements, comfort letters and consents related to SEC registration statements and other capital-raising activities and certain reports relating to Citi’s regulatory filings, reports on internal control reviews required by regulators, evaluation of accounting for completed transactions, and reviews of Citi’s interim financial statements.

Audit-Related Fees

This includes fees for services performed by KPMG that are closely related to audits and in many cases could only be provided by our independent registered public accounting firm. Such services may include accounting consultations, internal control reviews not required by regulators, securitization-related services, employee benefit plan audits, certain attestation services as well as certain agreed upon procedures, and due diligence services related to contemplated mergers and acquisitions.

Tax Fees

This includes preparation and review of corporate tax returns, expense allocation reports for tax purposes, and other tax compliance services.

All Other Fees

Citi engaged KPMG for one service in 2018 classified under “All Other Fees.” The aggregate fee amount of $11,400 is included in the total amount; however, due to rounding, this fee is not represented in the “All Other Fees” column.

Citi 2019 Proxy Statement


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PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 71

Approval of Independent Registered Public Accounting Firm Services and Fees

Citi’s Audit Committee has reviewed and approved all fees earned in 2018 and 2017 by Citi’s independent registered public accounting firm and actively monitored the relationship between audit and non-audit services provided. The Audit Committee has concluded that the fees earned by KPMG were consistent with the maintenance of the external auditors’ independence in the conduct of its auditing functions.

The Audit Committee must pre-approve all services provided and fees earned by Citi’s independent registered public accounting firm. The Audit Committee annually considers the provision of audit services and, if appropriate, pre-approves certain defined audit fees, audit-related fees, and tax-compliance fees with specific dollar-value limits for each category of service. The Audit Committee also considers on a case-by-case basis specific engagements that are not otherwise pre-approved (e.g., internal control and certain tax compliance engagements) or that exceed pre-approved fee amounts. On an interim basis, any proposed engagement that does not fit within the definition of a pre-approved service may be presented to the Chair of the Audit Committee for approval and to the full Audit Committee at its next regular meeting.

The Accounting Firm Engagement Standard is the primary basis upon which management ensures the independence of its independent registered public accounting firm. Administration of the Standard is centralized in, and monitored by, Citi senior corporate financial management, which reports the engagements earned by KPMG throughout the year to the Audit Committee. The Standard also includes limitations on the hiring of KPMG partners and other professionals to ensure that Citi satisfies applicable auditor independence rules.

KPMG has served as the independent registered public accounting firm of Citi and its predecessors since 1969. As in prior years, Citi and its Audit Committee have engaged in a review of KPMG in connection with the Audit Committee’s consideration of whether to recommend that stockholders ratify the selection of KPMG as Citi’s independent auditor for the following year. In that review, the Audit Committee considers both the continued independence of KPMG and whether retaining KPMG is in the best interests of Citi and its stockholders. Citi’s management prepares an annual assessment of KPMG for the Audit Committee that includes (i) the results of a management survey of KPMG’s overall performance; (ii) an analysis of KPMG’s known legal risks and significant proceedings that may impair KPMG’s ability to perform Citi’s annual audit; and (iii) KPMG’s fees and services provided to Citi both on an absolute basis, noting, of course, that KPMG does not provide any non-audit services, other than those described in the Proxy Statement, to Citi, and compared to services provided by other auditing firms to peer institutions. In addition, KPMG reviews with the Audit Committee its analysis of its independence in accordance with the Accounting Firm Engagement Standard and PCAOB Rule 3526. In performing its analysis, the Audit Committee considered the length of time KPMG has been Citi’s independent auditor, the breadth and complexity of Citi’s business and its global footprint and the resulting demands placed on its auditing firm in terms of expertise in Citi’s businesses, the quantity and quality of staff, and global reach. The Audit Committee recognized the ability of KPMG to provide both the necessary expertise to audit Citi’s business and the matching global footprint to audit Citi worldwide and other factors, including the policies that KPMG follows with respect to rotation of the key audit personnel, so that there is a new partner-in-charge at least every five years. Citi’s Audit Committee oversees the process for, and ultimately approves, the selection of the independent auditor’s lead engagement partner at the five-year mandatory rotation period. At the Audit Committee’s instruction, KPMG selects candidates to be considered for the lead engagement partner role, who are then interviewed by members of Citi’s senior management. After considering the candidates recommended by KPMG, senior management makes a recommendation to the Audit Committee regarding the new lead engagement partner. After discussing the qualifications of the proposed lead engagement partner with the current lead engagement partner and senior leadership of KPMG, the members of the Audit Committee, individually and/ or as a group, interview the leading candidate. The Audit Committee then considers the appointment and votes as an Audit Committee on the selection. The Audit Committee also reviewed external data on audit quality and performance, including recent PCAOB reports on KPMG and its peer firms. Based on the results of its review this year, the Audit Committee concluded that KPMG is independent and that it is in the best interests of Citi and its investors to appoint KPMG to serve as Citi’s independent registered accounting firm for 2019.

Board Recommendation

The Board recommends a vote FOR ratification of KPMG as Citi’s independent registered public accounting firm for 2019.
  

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Proposal 3: Advisory Vote to Approve Citi’s 2018 Executive Compensation

We are seeking a nonbinding, advisory vote approving the compensation of Citi’s named executive officers as disclosed in this Proxy Statement, as required by Section 14A and Rule 14a-21(a) of the Securities Exchange Act of 1934. We ask for this advisory vote annually. You are asked to vote on the following nonbinding advisory resolution:

RESOLVED, that the compensation paid to Citi’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and narrative discussion, is hereby APPROVED.

Board Recommendation

The Board recommends a vote FOR Proposal 3, which is advisory approval of Citi’s executive compensation as disclosed in this Proxy Statement.
  

Compensation Discussion and Analysis

Our Compensation Discussion and Analysis is organized into five sections:
2018 Company Performance (pages 72-74);
Summary of Pay Decisions (pages 75-80);
2018 Executive Compensation Awards (pages 81-93);
Long-Term Incentives (pages 94-95); and
Additional Compensation Practices (pages 95-98).

The 2018 Summary Compensation Table and Compensation Information follow on pages 99-107.

2018 Company Performance

2018 Company Performance – Solid Progress

The Personnel and Compensation Committee of the Citigroup Inc. Board of Directors (the Compensation Committee) recognized the following when awarding executive incentive pay for 2018:

Citi made solid progress in 2018 toward improving its profitability and returns, despite a more challenging revenue environment.
For 2018, Citi reported net income of $18.0 billion on revenues of $72.9 billion, compared to a net loss of $6.8 billion on revenues of $72.4 billion in 2017.(1) Excluding the one-time impact of the Tax Cuts and Jobs Act (Tax Reform) in both periods, Citi’s net income increased 14% compared to the prior year.
Citi’s earnings per share were $6.65 for 2018, up 25% from the prior year, compared to $5.33 per share for 2017, excluding the one-time impact of Tax Reform in both periods.
Our return on tangible common equity(2) improved to 10.9% in 2018, compared to 8.1% in 2017, excluding the one-time impact of Tax Reform in both periods.

(1) Results in 2018 included a one-time benefit of $94 million, or $0.03 per share, due to the finalization of the provisional component of the impact of Tax Reform based on Citi’s analysis as well as additional guidance received from the U.S. Treasury Department. Results in 2017 included a one-time, non-cash charge of $22.6 billion, or ($8.31) per share, related to the enactment of Tax Reform. As used throughout this Compensation Discussion and Analysis, Citi’s results of operations excluding the impact of Tax Reform are non-GAAP financial measures. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.
(2) Return on tangible common equity, or RoTCE, is a non-GAAP financial measure. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 73

Citi’s revenues increased 1% in 2018, including 3% underlying revenue growth in Global Consumer Banking and Institutional Clients Group, excluding the impact of previously disclosed gains on sale in 2018 and 2017.(1)
Citi reported revenue growth in all regions in Global Consumer Banking, reflecting continued loan and overall deposit growth, partially offset by the near-term impact of weak market sentiment on Asia wealth management revenues, as well as the impact from partnership renewal terms that went into effect in 2018 in Citi-branded cards in North America Global Consumer Banking.
Citi had solid revenue growth across treasury and trade solutions, private bank, securities services, equity markets, and corporate lending in Institutional Clients Group, partially offset by weakness in fixed income as well as softness in equity and debt underwriting.
Citi demonstrated strong expense discipline, resulting in a 1% decrease in expenses and an improved operating efficiency ratio of approximately 57%, even as Citi continued to make ongoing investments.
Citi’s positive operating leverage in 2018, combined with continued credit discipline, resulted in an improvement in pretax earnings.
We continued to optimize our capital base while maintaining a strong capital and liquidity position.
We received a non-objection from the Federal Reserve Board for the capital plan submitted as part of the 2018 Comprehensive Capital Analysis and Review (CCAR).
In 2018, Citi returned $18.4 billion of capital to common stockholders through share repurchases and dividends. Citi repurchased over 200 million shares during the last year, resulting in an 8% reduction in outstanding common shares.
Notwithstanding the substantial capital return in 2018, we ended the year with capital ratios well above regulatory minimum requirements.

Summary of 2018 Business Performance

The following graphs demonstrate our achievements and progress against key metrics.



(1) Efficiency ratio is total operating expenses divided by total revenues (net of interest expense). As a result, a lower efficiency ratio is generally better than a higher efficiency ratio.
(2) Results are presented excluding the impact of Tax Reform in both periods. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.
(3) Return on assets is net income divided by average assets.
(4) Return on tangible common equity is net income available to common stockholders (net income less preferred dividends) divided by average tangible common equity.
(5) Distributions include buybacks of Citi common stock and dividends on Citi common stock.
(6) The payout ratio is distributions to common stockholders divided by net income available to common stockholders.
____________________
(1) Citi's reported revenues reflected the impact of foreign currency translation into U.S. dollars for reporting purposes (FX translation) as well as previously disclosed gains on sale in 2018 and 2017. Citi's results of operations excluding the impact of FX translation and gains on sale are non-GAAP financial measures.

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74 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

2018 Financial Objectives

During our outreach to stockholders, we heard that they wanted disclosure of performance against goals used in our executive scorecards to better understand company performance. Accordingly, the chart to the right shows how Citi performed in 2018 against the principal goals we set for our executives in their scorecards. We set each 2018 goal at a level that exceeded the achievement in 2017, reflecting the challenging nature of our goals.

         
EFFICIENCY RATIO     RETURN ON TANGIBLE
COMMON EQUITY(1)
    RETURN ON ASSETS(1)
         

(1) Results are presented excluding the impact of Tax Reform. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.

Relative Total Shareholder Return

The group of companies shown in the following graphs is our compensation peer group. As explained on page 83, we believe this group reflects the competitive market for talent in certain key roles, including the CEO role. While our relative total shareholder returns declined from 2017 to 2018, primarily as a result of deterioration in December 2018, one- and three-year relative stock performance through November 2018 and more recent performance in 2019 are more aligned with the stronger returns for periods ending on December 31, 2017.

 
2018 ONE-YEAR TOTAL SHAREHOLDER RETURN(1)   2018 THREE-YEAR CUMULATIVE TOTAL SHAREHOLDER RETURN(1)
     
 
2017 ONE-YEAR TOTAL SHAREHOLDER RETURN(1)   2017 THREE-YEAR CUMULATIVE TOTAL SHAREHOLDER RETURN(1)

(1) Increase in share price plus reinvested dividends over one- and three-year periods ending on December 31, 2017, and December 31, 2018, expressed as a percentage of the share price at the beginning of such periods. Source: third-party public databases and company websites.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 75

Summary of Pay Decisions

Our Stockholder Engagement

Our current executive compensation program reflects extensive stockholder engagement over the past three years. Throughout this period, the Compensation Committee and management undertook a comprehensive review of our executive compensation program, and as part of this process, we held meetings with each stockholder who accepted our invitation to engage.

In 2018, we held two sets of stockholder outreach meetings with holders of meaningful percentages of our outstanding shares, given the size of our shareholder base.

Spring 2018: Following the awards for 2017 performance but in advance of our 2018 Annual Meeting, Mr. O’Neill, then our Board Chair, and Mr. Hennes, the Chair of our Compensation Committee, led a stockholder outreach effort seeking feedback on last year’s executive compensation awards. In this round of engagement, we spoke to stockholders representing about 27.5% of our outstanding shares. The feedback we received on our executive pay program was broadly favorable, reflecting the numerous changes made in previous years in direct response to stockholder comments.
Fall 2018/Winter 2019: In addition, in the fall of 2018 and into early 2019, we engaged with stockholders representing about 31% of our outstanding shares in a series of meetings that focused on sustainability issues, including climate change and human capital management. In the area of human capital management, the topics we addressed with stockholders included executive compensation practices, diverse representation in senior roles at Citi, talent development and succession planning, and identifying unintended biases in Citi’s people processes, including gender pay equity.

We were pleased with the positive feedback from our stockholders and their endorsement of our executive compensation program, which resulted in a 94.58% favorable Say on Pay vote at our 2018 Annual Meeting. In response to this favorable result, we kept the core structure of our pay program and our disclosure consistent with last year. We also increased the performance targets in the Performance Share Units awarded for 2018 performance over prior-year targets and prior-year performance to reflect our improving performance and to further align the program with stockholder interests.

OUR STOCKHOLDER-RESPONSIVE EXECUTIVE PAY PROGRAM

As set forth below, all the material features of our executive compensation program are designed to be aligned with stockholder interests and in most cases are directly responsive to stockholder feedback we have received during the past three years.

Transparent disclosure of annual goals. Each executive’s total incentive award (including the annual cash bonus component of the total incentive award) is based on the overall achievements of Citi and individual executive performance against predetermined goals set at the beginning of each year. We disclose three key goals — efficiency ratio, return on tangible common equity, and return on assets — after the end of the year so stockholders can directly assess executive performance.
Extensive disclosure of pay rationales. Our extensive scorecard disclosure clarifies the rigorous process we use for determining compensation.
Equity-based compensation. Seventy percent of the total CEO incentive opportunity is awarded as equity-based, deferred long-term incentive compensation.
Operational performance metrics. Our Performance Share Unit program includes two performance metrics: return on tangible common equity and cumulative earnings per share, which are forward-looking operational metrics used by investors to assess our performance over time. We disclose the metric targets at the start of the performance period to enable stockholders to assess the challenging nature of our goals.
Rigorous targets. Our Performance Share Unit metrics require substantial operational improvements for target payout and exceptional performance for maximum payout. Targets have been set at higher levels each year.
Robust clawbacks. Incentive compensation is subject to broad clawbacks, as described on page 97.
U.S. peer group. Our 13-firm compensation peer group is a reasonable representation of the market for executive talent in which we compete.
Limit on cash bonuses. We have a $20 million limit on individual executive officer cash bonuses.
Governance. We have strong compensation governance practices, including an executive stock ownership commitment. Additional details on practices we employ and avoid in support of our performance-oriented culture are set forth in the table on page 80.

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76 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

Compensation Philosophy and Framework

We seek to design our executive pay program to motivate balanced behaviors, consistent with our focus on balanced long-term strategic goals. Our Compensation Philosophy, as summarized as a set of objectives below, is designed to encourage prudent risk-taking while attracting the world-class talent necessary to Citi’s success.

OUR COMPENSATION PHILOSOPHY
Reinforce a business culture based on the highest ethical standards
Manage risks to Citi by encouraging prudent decision-making
Reflect regulatory guidance in compensation programs
Attract and retain the best talent to lead Citi to success
Align compensation programs, structures, and decisions with stockholder and other stakeholder interests

OUR LEADERSHIP ON PAY EQUITY

We continue to align our compensation programs with stakeholder interests through our pay equity disclosures, related changes to pay, and announced representation goals. In 2017, Citi was the first large U.S. financial institution to publicly release the results of a pay equity review. Our 2017 review compared compensation of women to men in the U.S., the U.K., and Germany, and, in the U.S., minorities to non-minorities. Our review adjusted pay to account for a number of factors to make the comparisons meaningful, including job function, level, and geography, and we modified pay in response to the results. In 2018, we extended our pay equity review to include employees globally, and we found that in 2018 women globally were paid on average 99% of what men are paid at Citi and that there is no statistically significant difference between what U.S. minorities and non-minorities are paid at Citi. As in 2017, we modified pay in 2018 in response to the findings.

Earlier this year, we were the first large U.S. company to disclose our unadjusted or “raw” pay gap for women and U.S. minorities, which measures median total compensation unadjusted for factors such as job function, level, and geography. The analysis shows that the median pay at Citi for women globally is 71% of the median for men, and the median pay at Citi for U.S. minorities is 93% of the median for non-minorities. We are committing to reduce the raw pay gap numbers over time by increasing the representation of women and U.S. minorities in senior and higher-paying roles. As a starting point, our goal is to increase the representation in mid- and senior-level roles to at least 40% for women globally and 8% for Black employees in the U.S. by the end of 2021.


OUR EXECUTIVE COMPENSATION FRAMEWORK

Our Compensation Philosophy is reflected in our executive compensation Framework, which enables incentive compensation awards to closely reflect business and individual performance, consistent with our pay-for-performance approach. Full information on our executive compensation Framework appears on page 82.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 77

2018 CEO Compensation

As it has done the past several years, the Compensation Committee evaluated 2018 CEO performance using our executive compensation Framework that measures results against quantitative and qualitative goals set at the beginning of the year. As explained in more detail on page 81, we use a rating system of 1 to 5 to assess performance against each goal, with 1 being the highest (Significant Outperform) and 5 being the lowest (Significant Underperform). The green color coding signifies that a quantitative goal set for 2018 was met or exceeded.

SUMMARY OF CEO SCORECARD RESULTS
Quantitative Goal (Glossary on Page 127)   2018 Result(1)(2)       Rating(2)
Citigroup Income from Continuing
Operations Before Taxes $23.4 billion 3
Citigroup Efficiency Ratio 57.4% 3
Citigroup Return on Tangible
Common Equity 10.9% 2
Citigroup Return on Assets 0.93% 3
Risk
Citigroup Risk Appetite Ratio 151%
Citigroup Risk Appetite Surplus $7.61 billion 1
    Qualitative Goal     Rating(2)
Protect and enhance
our reputation 3
Develop client-relevant
value propositions 2
Produce extraordinary
client experiences 2
Deliver our financial
commitments 3


(1) Return on Tangible Common Equity and Return on Assets exclude the impact of Tax Reform in 2018. In addition, as used throughout this Compensation Discussion and Analysis, Risk Appetite Ratio and Risk Appetite Surplus are non-GAAP financial measures. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.
(2) Explanations of the colors and ratings used in the scorecards appear on page 81.

Pages 84-85 present a detailed overview of the CEO’s scorecard and the performance evaluation process, which resulted in the Compensation Committee awarding Mr. Corbat $24 million in total annual compensation for 2018. His total annual compensation consisted of his base salary of $1.5 million (unchanged since 2013) and a total annual incentive award of $22.5 million, representing a 4% increase over his 2017 total annual compensation of $23 million. Using Citi’s balanced scorecard approach to determining pay, the Compensation Committee favorably assessed Mr. Corbat’s leadership in multiple critical areas, including enhancing our reputation, delivering value to clients, and continued progress toward Citi’s longer-term targets. In addition to Citi’s positive operating results, the Compensation Committee also considered market levels of pay for the CEO role at peer institutions.

LINKING 2018 CEO PAY ELEMENTS TO PERFORMANCE

     
Over 90% variable pay for 2018.
70% of variable pay is deferred long-term incentives subject to multi-year vesting and clawbacks.
70% of variable pay is equity-based to align stockholder and executive interests.
Total incentive award and annual bonus are based on the overall achievements of Citi and individual performance against goals set at the beginning of the year.
PSUs are earned only to the extent Citi performs against two forward-looking metrics: RoTCE in 2021 and cumulative EPS over the 2019-2021 performance period.
PSU metrics require substantial operational improvements for target payout and exceptional performance for maximum payout.

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78 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

2018 Pay Elements

Citi’s incentive awards delivered to the CEO and the other named executive officers (NEOs) are a mix of cash bonus, Performance Share Units, and Deferred Stock Awards. This incentive structure establishes a balance between annual and long-term compensation, with the majority of incentive compensation delivered in Performance Share Units and Deferred Stock Awards that vest over multiple years. In determining the percentages to award as cash bonuses, Performance Share Units, and Deferred Stock Awards, the Compensation Committee considered applicable regulatory requirements and guidelines for deferral as well as market practices.

% OF
VARIABLE PAY
COMPENSATION
ELEMENT       CEO          NEOs       AWARD TYPE       PERFORMANCE LINK AND VESTING       TYPE
Fixed
Salary N/A N/A Base Pay
Fixed portion of total pay at a competitive level that enables Citi to attract and retain talent
Cash
Variable
Annual
Incentive
30% 40% Annual Bonus
Scorecard assessment determines value
Plan limits on executive officer cash bonuses
Cash

Deferred/
Long-Term
Incentives
(LTI)

70%

60%

Performance
Share Units
(50% of LTI)

Scorecard assessment determines target number of units
Earned units based 50% on return on tangible common equity in 2021 and 50% on cumulative earnings per share over 2019-2021
Ultimate value of earned units linked to Citi total shareholder returns
Award capped at 100% of target if Citi’s total shareholder return is negative over 2019-2021
Subject to clawbacks
Other than increases in targets, no change in award terms as compared to last year

Equity-based,
but settled in
cash to limit
dilution to
stockholders

Deferred Stock
Awards
(50% of LTI)

Scorecard assessment determines number of shares granted
Ultimate value based on Citi total shareholder returns
Vest ratably over a four-year period
Subject to reduction in the event of pretax losses in any year of the deferral period
Subject to clawbacks
No change in award terms as compared to prior years

Equity

Performance Share Unit Targets

We have consistently set challenging targets for our Performance Share Units. For the Performance Share Units awarded for 2018 performance:

We have set a target return on tangible common equity achievement of 14% by 2021, which is meaningfully higher than the 10.9% we achieved in 2018 (excluding the impact of Tax Reform). Although this metric is stated as a 2021 target, it also incentivizes consistent improvement in returns throughout the performance period.
We have set a cumulative earnings per share target for the three-year performance period 2019 through 2021 of $26.25, which is reflective of significant earnings per share growth over the period. Cumulative earnings per share mitigates potential risk associated with a single year-end target and drives balanced improvement in operational performance over the performance period.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 79

As a matter of policy, our preference is to redeploy earned capital within our businesses, provided that such investments are expected to produce returns above our cost of capital. To the extent that the capital we generate exceeds our ability to productively redeploy it in our businesses, we intend to return it to stockholders.
We have several mechanisms in place to ensure that our earnings per share measure drives appropriate long-term decision-making. Buyback levels are subject to oversight by both the Citigroup Board and the Federal Reserve Board (through the CCAR process), and they are calibrated against a range of considerations, including current capital levels, alternative uses for excess capital, and safety and soundness.
To reflect and focus on our improving performance, we set the targets at levels that are more challenging than the targets for last year’s awards, which were a return on tangible common equity of 13% by 2020 and cumulative earnings per share of $22.50 for the three-year performance period 2018 through 2020.

Full details on our Performance Share Units for performance in 2018 appear on page 94.

Performance Share Unit Payouts

The variability of the value of our Performance Share Unit awards demonstrates the strong link between Citi’s executive pay and Citi’s performance. As an example, the following chart compares the grant date value of Mr. Corbat’s recent Performance Share Units to the value ultimately earned.

CEO PERFORMANCE SHARE UNIT PAYOUTS
 

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80 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

Compensation Governance Practices

In addition to our performance-sensitive direct compensation structure, Citi has strong compensation governance practices. Over the past several years, we have refined many of our governance practices as a result of feedback obtained through our ongoing engagement with stockholders.

PRACTICES WE EMPLOY       PRACTICES WE AVOID
Ongoing investor outreach. Regular stockholder engagement to solicit feedback on compensation and governance.
Performance-based compensation. For 2018, variable performance-based incentive compensation was at least 94% of named executive officer annual compensation. The deferred variable award is further at risk based on the value of Citi common stock over multi-year vesting periods.
Limit on cash bonus. Limit of $20 million on the portion of each executive officer’s annual incentive award that may be paid in cash.
Clawbacks. Subjected Performance Share Units and Deferred Stock Awards to clawbacks, as described on page 97.
Stock ownership commitment. Executive officers are required to hold at least 75% of the net after-tax shares acquired through our incentive compensation programs as long as they are executive officers.
Post-employment stock holding requirement. Effective January 1, 2013, each executive officer must retain at least 50% of the shares subject to the stock ownership commitment for one year after ceasing to be an executive officer, even if he or she is no longer employed by Citi.
Peer group review. Annual evaluation of peer group to ensure ongoing relevance of each member.
Risk management. Strong risk and control policies and consideration of risk management factors in making compensation decisions, as described on pages 95-97.
Independent advice. Independent compensation consultant input into the Compensation Committee’s decisions, as described on page 97.
No excessive perks. We do not provide personal perquisites such as free personal use of private aircraft or special executive medical benefits.
No executive pensions. Executive officers are not eligible for additional benefit accruals under nonqualified executive retirement programs.
No hedging or pledging of Citi stock. We have a blanket prohibition against hedging or pledging Citi common stock by executive officers.
No tax gross-ups. Citi does not allow tax gross-ups except through its tax equalization program for expatriates, which is available to all salaried employees.
No multi-year compensation guarantees. We avoid features that could incentivize imprudent risk-taking, such as multi-year guarantees.
No “single trigger” upon a change of control. Our stock incentive plan has a “double trigger” change-of-control feature, meaning that both a change of control of Citigroup and an involuntary termination of employment not for gross misconduct must occur for awards to vest.
No change-of-control or other “golden parachute” agreements. Executive officers do not have special agreements covering their compensation in the event of a change of control and are not entitled to severance pay upon termination of employment in excess of broad-based benefits.
No unearned dividends paid. We do not pay dividend equivalents on unearned Performance Share Units or unvested Deferred Stock Awards. Dividend equivalents on earned awards commence payment at the time of vesting, and the dividend rate is the same for the executive officers as for other stockholders.
No extensive use of employment agreements. None of the named executive officers has an employment agreement with Citi. We make limited use of employment agreements, and their terms are subject to controls under our policies. Under a policy adopted by the Board, employment agreements with executive officers may not provide for post-retirement personal benefits of a kind not generally available to employees or retirees.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 81

2018 Executive Compensation Awards

2018 Named Executive Officer Compensation

The Compensation Committee approved the following compensation for performance in 2018:

1 2 3

4
Annual
Compensation
for 2018
(Sum of
Columns 1-4)
Name       Base Salary(1)       Cash Bonus(1)       Performance
Share Units(2)
      Deferred Stock
Awards(2)
     
Michael Corbat $1,500,000 $6,750,000 $7,875,000 $7,875,000      $24,000,000
John Gerspach $500,000 $4,600,000 $3,450,000 $3,450,000 $12,000,000
James Forese $500,000 $7,800,000 $5,850,000 $5,850,000 $20,000,000
Stephen Bird $500,000 $4,400,000 $3,300,000 $3,300,000 $11,500,000
Jane Fraser $500,000 $3,500,000 $2,625,000 $2,625,000 $9,250,000

(1)Reported in the 2018 Summary Compensation Table.
(2)In accordance with SEC rules, these awards are not reportable in the 2018 Summary Compensation Table because they were not awarded during 2018. They will be reportable next year in the 2019 Summary Compensation Table.

The above table is not intended to be a substitute for the reporting of compensation in accordance with SEC rules as shown in the 2018 Summary Compensation Table.

Roadmap for the Scorecards on Pages 84-93

The scorecards on pages 84-93 illustrate how our executive compensation Framework is used by the Compensation Committee to make compensation decisions.

The scorecards:

Show how the Compensation Committee assessed each named executive officer’s performance against quantitative and qualitative goals established early in the year.
Explain the size and scope of each named executive officer role to provide context for the Compensation Committee’s decision and level of pay.
Explain how the Compensation Committee arrived at its decision on each named executive officer’s compensation.

The colors in the Quantitative Goal section of the scorecards are intended to visually signify relative performance against operational and risk-related quantitative goals, as follows:

Signifies that an operational goal result achieved the 2018 goal or exceeded the 2018 goal by up to 10%.(1) Signifies that a risk goal result was achieved.

Signifies that an operational goal result was below the 2018 goal by 10% or less. Signifies that a risk goal had a positive but below-target result.

Signifies that an operational goal result was below the 2018 goal by more than 10%. Signifies that a risk goal had a negative result.


(1)Additional colors or definitions would be provided if any achievements are greater than 10% of a goal.

The Compensation Committee assesses performance against each quantitative and qualitative goal according to the following scale:

Score       1       2       3       4       5
Rating Significant
Outperform
Outperform Meets
Expectations
Underperform Significant
Underperform

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82 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

Citi’s Executive Compensation Framework

Our Compensation Committee uses a five-step process to determine named executive officer incentive compensation.

Step 1 – Goal Setting and Goal Weightings for Scorecards

The Compensation Committee sets scorecard goals for each named executive officer early in each year. Performance goals fall into two categories, quantitative and qualitative, and vary by named executive officer:

Quantitative goals include:

Company-wide goals for all named executive officers that reflect our annual business plan, and

Business unit-specific goals for named executive officers who are business unit leaders that reflect annual plans for our individual business units.

Qualitative goals focus on:

Enhancing Citi’s reputation,

Delivering value to clients, and

Continued progress toward Citi’s longer-term targets.

When we set the goals, we also assign weightings to the goals. For 2018 and consistent with prior years, quantitative goals were weighted 70% and qualitative goals were weighted 30% in the calculation of the year-end overall scorecard rating for each named executive officer.

Step 2 – Scorecard Assessment

After the end of each year, a named executive officer’s performance against each quantitative and qualitative goal is assessed.

A performance rating is assigned for each goal on a scale of 1 to 5, with 1 being “significant outperform” and 5 being “significant underperform,” reflecting a subjective assessment of the executive’s performance against the goal.

In accordance with the relative weightings established early in 2018, quantitative goal ratings were averaged and weighted 70% and qualitative goals were averaged and weighted 30% in arriving at an overall scorecard rating for each named executive officer.

The Compensation Committee rates the CEO’s performance, and the Compensation Committee and the CEO rate the performance of the other named executive officers.

Step 3 – Evaluation of Market Pay

The Compensation Committee reviews an estimated market pay range for each named executive officer role. Ranges are developed based on public information and third-party market surveys of compensation for the same or comparable roles at peer firms.

This practice ensures that our named executive officer pay appropriately reflects market pay, based on varying levels of performance.

Step 4 – Linking Performance to Compensation

The Compensation Committee then evaluates each named executive officer’s overall scorecard rating relative to the estimated market-based pay range for each named executive officer role.

The overall scorecard rating determines whether compensation should be preliminarily targeted at, above, or below the estimated market median pay for the role. An overall scorecard rating of 3 would generally correspond to market median pay levels, with an overall 2 rating generally corresponding to above market median and an overall 4 rating generally corresponding to below market median.

The Compensation Committee believes that the simultaneous evaluation of scorecard performance and market pay is the most effective approach to aligning pay and performance in an industry where market levels of pay can change dynamically.

Step 5 – Committee Determination

Based on the evaluation of the scorecard ratings and market pay described in Step 4, the Compensation Committee, exercising its discretion, determines the final award amount for each named executive officer. The objective, non-formulaic factors (such as risk behaviors) that inform the decision are explained in detail within each named executive officer’s scorecard.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 83

Our Compensation Peer Group

The Compensation Committee believes that market compensation levels must frame compensation decisions in order to retain the executive talent necessary to execute the Company’s business strategy. Accordingly, a critical step in our executive compensation Framework is the Compensation Committee’s understanding of market pay, which it develops through consideration of surveys of historic peer firm compensation for each named executive officer role.

In 2016, the Compensation Committee, with input from its independent compensation consultant, established the compensation peer group Citi currently uses to determine market pay ranges. The Compensation Committee evaluates the compensation peer group on an annual basis to ensure that the group continues to be appropriate. The Compensation Committee continues to believe that a U.S.-based peer group reflects the relevant market for executive talent and the relevant regulatory environment for Citi’s executive compensation.

Our peers were chosen because they operate in one or more lines of business that are similar to Citi’s and compete in similar labor markets, although many do not have global scale that is comparable to Citi.

2018 COMPENSATION PEER GROUP

AIG (AIG)
American Express (AXP)
Bank of America (BAC)
BNY Mellon (BK)
Capital One (COF)

Goldman Sachs (GS)
JPMorgan Chase (JPM)
MetLife (MET)
Morgan Stanley (MS)
PNC (PNC)

Prudential (PRU)
U.S. Bancorp (USB)
Wells Fargo (WFC)

All compensation peer group firms were included in preparing the market data for the CEO and CFO roles. Not all compensation peer group firms have roles comparable to Citi’s named executive officer roles other than the CEO and CFO roles (e.g., the Institutional Clients Group role), so not all of the compensation peer group firms were represented in the market data for each of the other named executive officer roles. In evaluating the market for named executive officer compensation, the Compensation Committee additionally focused on compensation for comparable roles at the U.S.-based global banks with lines of business similar to Citi’s. That group includes Bank of America, Goldman Sachs, JP Morgan Chase, Morgan Stanley, and Wells Fargo.

In selecting the compensation peer group, the Compensation Committee used size-based metrics as primary screening criteria among financial services firms. Due to the absence of a sufficient number of comparably sized direct peers, the result is a peer group where Citi is above the 75th percentile in size, meaning that the market for target compensation prior to consideration of performance could be the upper quartile. Where Citi pays executives above median, the size and scope of their responsibilities and their performance tend to be critical factors in determining pay ranges.

2018 CITI POSITIONING RELATIVE TO PEER COMPANIES

(1) AIG employees as of 12/31/2017; MET employees as of 10/1/2017; PRU employees as of 12/31/2017.

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84 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

CEO Scorecard and Pay Explanation

Mr. Corbat has been CEO of Citi since October 2012. He joined Citi in 1983 and has held various management positions throughout Citi in multiple businesses and geographies.

QUANTITATIVE SCORECARD
Category       Quantitative Goal (Glossary on Page 127)       2018 Result(1)(2)       Rating(2)
Profitability   Citigroup Income from Continuing Operations Before Taxes   $23.4 billion   3
Expense Management   Citigroup Efficiency Ratio   57.4%   3
Use of Capital     Citigroup Return on Tangible Common Equity   10.9%   2
     Citigroup Return on Assets   0.93%   3
Risk   Citigroup Risk Appetite Ratio   151%   1
    Citigroup Risk Appetite Surplus   $7.61 billion  

QUALITATIVE SCORECARD

Qualitative Goal

     

Result Highlights (Glossary on Page 127)

     

Rating(2)

Protect and enhance our reputation

 
Mr. Corbat continues to provide prominent and clear messaging across the company around the firm’s culture of ethics and conduct.
Under Mr. Corbat’s sponsorship, Citi received no objection from regulators to its capital plan submitted as part of the 2018 CCAR process, enabling the return of $18.4 billion of capital to common stockholders during 2018. Citi repurchased over 200 million shares during 2018, resulting in an 8% reduction in outstanding common shares.
Notwithstanding the continued progress in returning capital to shareholders, each of Citi’s key regulatory capital metrics remained strong.
Control metrics generally improved year-over-year across Citi, and as measured by objective risk metrics, Citi’s risk profile was stable in 2018. Many outstanding regulatory issues were resolved, while others remain as focus areas.
Mr. Corbat championed Citi’s leadership in disclosing gender and U.S. minority pay gaps and making related adjustments to compensation globally. We have published our goals to improve representation of women and U.S. minorities in senior roles throughout Citi.
Mr. Corbat continued his outreach to external stakeholders globally, including investors, regulators, and government officials.
He led investor outreach by conducting 36 investor meetings in 2018.
In addition to regular bank supervisory meetings, he participated in 56 meetings in 2018 with regulators, central bankers, and government officials from the U.S. and other countries.
 

3

Develop client-relevant value propositions

 
Mr. Corbat maintained regular client contact by holding, on average, approximately 40 client meetings per month in cities around the world.
Mr. Corbat drove continued focus on key investments in Global Consumer Banking and Institutional Clients Group that are already showing results, such as digital and mobile innovations in consumer banking and investments in our equities business.
 

2

Produce extraordinary client experiences

  
Innovations sponsored by Mr. Corbat have led to improved client satisfaction scores on objective surveys in Global Consumer Banking and Institutional Clients Group.
Key digital user metrics improved substantially year-over-year, and in Institutional Clients Group, we have significantly improved the client onboarding experience.
 

2

Deliver our financial commitments

 
Key financial metrics, including Citi’s 2018 return on tangible common equity, exceeded 2017 results (excluding the impact of Tax Reform in both periods) and our 2018 business plan.
 

3


(1) Return on Tangible Common Equity and Return on Assets exclude the impact of Tax Reform in 2018. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.
(2) Explanations of the colors and ratings used in the scorecards appear on page 81.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 85

SIZE AND SCOPE OF ROLE

As CEO, Mr. Corbat is responsible for Citi’s global business operations. Citi’s Global Consumer Banking businesses operate in North America, Mexico, and Asia and provide traditional banking services to retail customers through retail banking, including commercial banking, and Citi-branded cards and retail services. Citi’s Institutional Clients Group provides corporate, institutional, public sector, and high-net-worth clients around the world with a full range of wholesale banking products and services.

Citi has approximately 200 million customer accounts and does business in over 160 countries and jurisdictions. Citi believes this global network provides a strong foundation for servicing the broad financial services needs of its large multinational clients and for meeting the needs of retail, private banking, commercial, public sector, and institutional clients around the world.

As of December 31, 2018, Citi had:

revenues of $72.9 billion for full year 2018,

assets of approximately $1.92 trillion,

market capitalization of $123 billion,

approximately 204,000 employees, and

deposits of approximately $1.01 trillion.


COMMITTEE’S PAY RATIONALE

Scorecard Assessment Summary

Company-wide financial results reflected solid progress toward improving Citi’s profitability and returns, including return on tangible common equity, in a more challenging revenue environment. Citi attained the targets set at the beginning of 2018 and demonstrated improved operating performance over 2017.

The Compensation Committee considered Mr. Corbat’s notable 2018 qualitative goal achievements, such as the leadership demonstrated in the 2018 favorable CCAR result, which enabled the return of $18.4 billion in capital to stockholders during 2018.


Linking Performance to Compensation

Company business performance at or above targets combined with Mr. Corbat’s strong performance against qualitative goals resulted in an overall scorecard rating of 2.43, which points toward compensation above market median for the CEO role within our 13-firm compensation peer group. The overall scorecard rating was determined by averaging the quantitative goal ratings and weighting the result 70%, averaging the qualitative goal ratings and weighting the result 30%, then adding the two amounts ([2.4 x 0.7] + [2.5 x 0.3] = 2.43).


Final Award

The Compensation Committee awarded Mr. Corbat $24 million in total annual compensation for 2018, consisting of a base salary of $1.5 million and a total annual incentive award of $22.5 million, an increase of 4% over his total annual compensation for 2017 of $23 million. Mr. Corbat’s compensation was above market median for the CEO role based on a comparison to CEO pay in our 13-firm compensation peer group, consistent with the results produced by our executive compensation Framework, while at the same time was below the median of CEO pay at other U.S.-based global banks. In determining the final award amount in the exercise of its discretion, the Compensation Committee relied on the results of the executive compensation Framework and considered Citi’s solid progress toward its financial goals, market levels of pay at other U.S.-based global banks, and Mr. Corbat’s qualitative results.

www.citigroup.com


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86 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

CFO Scorecard and Pay Explanation

John Gerspach has been CFO of Citi since July 2009 and has served in various executive financial management roles globally since joining Citi in 1990. He retired from the CFO role on February 22, 2019.

QUANTITATIVE SCORECARD
Category       Quantitative Goal (Glossary on Page 127)       2018 Result(1)(2)       Rating(2)
Profitability Citigroup Income from Continuing Operations Before Taxes $23.4 billion 3
Expense Management Citigroup Efficiency Ratio 57.4% 3
Use of Capital Citigroup Return on Tangible Common Equity 10.9% 2
Citigroup Return on Assets 0.93% 3
Risk Citigroup Risk Appetite Ratio 151% 1
Citigroup Risk Appetite Surplus $7.61 billion

QUALITATIVE SCORECARD
Qualitative Goal       Result Highlights (Glossary on Page 127) Rating(2)
Protect and enhance
our reputation
    
Under Mr. Gerspach’s leadership, Citi received no objection from regulators to its capital plan submitted as part of the 2018 CCAR process, enabling the return of $18.4 billion of capital to common stockholders during 2018. Citi repurchased over 200 million shares during 2018, resulting in an 8% reduction in outstanding common shares.
Notwithstanding the continued progress in returning capital to shareholders, each of Citi’s key regulatory capital metrics remained strong.
Control metrics generally improved year-over-year across the Finance function, while areas of focus remain.
Succession planning efforts in Finance resulted in the orderly succession process pursuant to which Mark Mason was promoted to Citi CFO.
    

3

Develop client-
relevant value
propositions

Under Mr. Gerspach’s leadership, Citi Ventures continued to build a successful investment portfolio, resulting in substantial cost savings and incremental revenue to Citi.
The Finance function has continued to make productivity and process improvements that have lowered cost, improved the quality of financial reporting and analysis, and improved the effectiveness of our control environment.

3

Produce extraordinary
client experiences

Mr. Gerspach has sponsored multiple initiatives to deliver better insights to clients and faster execution.

3

Deliver our financial
commitments

Key financial metrics, including Citi’s 2018 return on tangible common equity, exceeded 2017 results (excluding the impact of Tax Reform in both periods) and our 2018 business plan.
Finance function efforts resulted in a reduction of Citi’s effective tax rate.

2


(1) Return on Tangible Common Equity and Return on Assets exclude the impact of Tax Reform in 2018. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.
(2) Explanations of the ratings used in the scorecards appear on page 81.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 87

SIZE AND SCOPE OF ROLE

Mr. Gerspach was Citi CFO throughout 2018 and until February 22, 2019. The Citi CFO is responsible for managing Citi’s balance sheet and Citi’s financial reporting processes. At December 31, 2018, Citi had approximately $1.92 trillion of assets and $1.01 trillion of deposits.

Among the disciplines reporting to the Citi CFO is Citi’s treasury function, which manages our capital, funding, and liquidity. In addition, the treasury function manages corporate oversight of risks related to liquidity, interest rates, and currency translation.

The Citi CFO leads the teams coordinating Citi’s responses to global financial regulatory reform. The Finance function also plays a central role in our CCAR capital planning process.

The Citi CFO leads many of Citi’s expense management initiatives and Finance also leads or participates in a range of financial control activities throughout the businesses.


COMMITTEE’S PAY RATIONALE
Scorecard Assessment Summary

Company-wide financial results reflected solid progress toward improving Citi’s profitability and returns, including return on tangible common equity, in a more challenging revenue environment. Citi attained the targets set at the beginning of 2018 and demonstrated improved operating performance over 2017.

The Compensation Committee considered Mr. Gerspach’s notable 2018 qualitative goal achievements, such as the leadership demonstrated in the 2018 favorable CCAR result and company-wide productivity improvements.


Linking Performance to Compensation

Company business performance at or above targets combined with Mr. Gerspach’s strong performance against qualitative goals resulted in an overall scorecard rating of 2.505, which points toward compensation above market median for the CFO role within our 13-firm compensation peer group. The overall scorecard rating was determined by averaging the quantitative goal ratings and weighting the result 70%, averaging the qualitative goal ratings and weighting the result 30%, then adding the two amounts ([2.4 x 0.7] + [2.75 x 0.3] = 2.505).


Final Award

The Compensation Committee awarded Mr. Gerspach $12 million in annual compensation for 2018, a 9% increase over his 2017 annual compensation of $11 million, in recognition of a gap to market levels of compensation for similar roles at U.S.-based global banks as well as Mr. Gerspach’s performance. Mr. Gerspach’s compensation was above market median for the CFO role based on a comparison to CFO pay in our 13-firm compensation peer group, consistent with the results produced by our executive compensation Framework, while at the same time was below the median of CFO pay at other U.S.-based global banks. In determining the final award amount in the exercise of its discretion, the Compensation Committee relied on the results of the executive compensation Framework and considered Citi’s solid progress toward its financial goals, market levels of pay at other U.S.-based global banks, and Mr. Gerspach’s qualitative results.

www.citigroup.com


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88 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

Citi President and Institutional Clients Group CEO Scorecard and Pay Explanation

James Forese is President of Citi and CEO of Institutional Clients Group (ICG). He assumed expanded duties as President of Citi in June 2015 after serving as Co-President of Citi and CEO of ICG since January 2013. Mr. Forese joined Citi in 1985 and has held various executive positions in multiple geographies throughout the businesses comprising ICG.

QUANTITATIVE SCORECARD
Mr. Forese’s performance on most quantitative metrics was evaluated on the basis of both company-wide and ICG results, consistent with his roles as President of Citi and as CEO of ICG.

Category       Quantitative Goal (Glossary on Page 127)       2018 Result(1)(2)       Rating(2)
Profitability Citigroup Income from Continuing Operations Before Taxes       $23.4 billion 3
ICG Income from Continuing Operations Before Taxes $15.8 billion
Expense Management Citigroup Efficiency Ratio 57.4% 3
ICG Efficiency Ratio 56.7%
Use of Capital Citigroup Return on Tangible Common Equity 10.9% 3
ICG Return on Tangible Common Equity 14.3%
Citigroup Return on Assets 0.93% 3
ICG Return on Assets 0.87%
Risk ICG Risk Appetite Ratio 219% 2
ICG Risk Appetite Surplus $8.15 billion

QUALITATIVE SCORECARD
Qualitative Goal       Result Highlights       Rating(2)
Protect and enhance
our reputation
As Citi President, Mr. Forese continues to provide prominent and clear messaging across the company around the firm’s culture of ethics and conduct.
Control metrics generally improved year-over-year across ICG. Many outstanding regulatory issues were resolved, while others remain as focus areas.
Led by Mr. Forese, ICG demonstrated improvement in key diversity metrics and ethical culture scores and implemented new approaches to entry-level hiring that have already increased diversity.
3

Develop client-
relevant value
propositions

Earnings in three priority areas – equities, investor services, and treasury and trade solutions – exceeded 2017 results and the 2018 business plan. Private bank revenues continued to grow.
Led by Mr. Forese, ICG continued to enhance controls while simplifying client-facing processes.
2

Produce extraordinary
client experiences

ICG greatly simplified and streamlined the client onboarding experience through use of technology in multiple areas, including trading platforms.
ICG continued to improve client satisfaction significantly, as measured in objective surveys.
1

Deliver our financial
commitments

Although ICG 2018 financial results fell short of its business plan, ICG’s underlying results in 2018 showed solid growth over 2017 levels. Led by Mr. Forese, ICG productivity improvements exceeded targets.

 2


(1) Citigroup Return on Tangible Common Equity and Citigroup Return on Assets exclude the impact of Tax Reform in 2018. For a reconciliation of all adjusted results to reported results, please see Annex A to this Proxy Statement.
(2) Explanations of the colors and ratings used in the scorecards appear on page 81.

Citi 2019 Proxy Statement


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PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION 89

SIZE AND SCOPE OF ROLE

As President of Citi, Mr. Forese leads enterprise-wide initiatives, including those designed to improve Citi’s execution of its business strategy and efforts to shape Citi’s culture through our common mission and value proposition statements.

Mr. Forese is also CEO of ICG, which provides corporate, institutional, public sector, and high-net-worth clients around the world with a full range of wholesale banking products and services, including fixed income and equity sales and trading, foreign exchange, prime brokerage, derivative services, equity and fixed income research, corporate lending, investment banking and advisory services, private banking, cash management, trade finance, and securities services.

ICG’s international presence is supported by trading floors in approximately 80 countries and a proprietary network in 98 countries and jurisdictions. At December 31, 2018, ICG had approximately $1.4 trillion of assets and $690 billion of deposits, while two of its businesses, securities services and issuer services, managed approximately $17.5 trillion of assets under custody.


COMMITTEE’S PAY RATIONALE
Scorecard Assessment Summary

Company-wide financial results reflected solid progress toward improving Citi’s profitability and returns, including return on tangible common equity, in a more challenging revenue environment. Citi attained the targets set at the beginning of 2018 and demonstrated improved operating performance over 2017. ICG had solid revenue growth across treasury and trade solutions, private bank, securities services, equity markets, and corporate lending, partially offset by weakness in fixed income as well as softness in equity and debt underwriting.

The Compensation Committee considered Mr. Forese’s notable 2018 qualitative goal achievements, including the success of investments in targeted ICG businesses.


Linking Performance to Compensation

Company business performance at or above targets and ICG business performance above or near targets combined with Mr. Forese’s strong performance against qualitative goals resulted in an overall scorecard rating of 2.635, which points toward compensation within the range of market median for Mr. Forese’s role as CEO of ICG. The overall scorecard rating was determined by averaging the quantitative goal ratings and weighting the result 70%, averaging the qualitative goal ratings and weighting the result 30%, then adding the two amounts ([2.8 x 0.7] + [2.25 x 0.3] = 2.635).


Final Award

The Compensation Committee awarded Mr. Forese $20 million in annual compensation for 2018, the same as his 2017 annual compensation of $20 million. Mr. Forese’s 2018 compensation was within the range of market median for his ICG role considering compensation at U.S.-based global banks, consistent with the results produced by our executive compensation Framework. In determining the final award amount in the exercise of its discretion, the Compensation Committee relied on the results of the executive compensation Framework, which reflect market levels of compensation, ICG’s 2018 business performance, and Mr. Forese’s qualitative results.

www.citigroup.com


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90 PROPOSAL 3: ADVISORY VOTE TO APPROVE CITI’S 2018 EXECUTIVE COMPENSATION

Global Consumer Banking CEO Scorecard and Pay Explanation

Stephen Bird became CEO of Global Consumer Banking (GCB) in June 2015. Previously, Mr. Bird was CEO of Citi’s Asia Pacific region, responsible for Citi’s business lines across the region. He joined Citi in 1998 and has held regional executive roles in Operations & Technology as well as business executive roles in GCB.

QUANTITATIVE SCORECARD
Mr. Bird’s performance on most quantitative metrics was evaluated on the basis of both company-wide and GCB results, consistent with his roles as an executive officer of Citi and as CEO of GCB.

Category       Quantitative Goal (Glossary on Page 127)       2018 Result(1)(2)       Rating(2)
Profitability Citigroup Income from Continuing Operations Before Taxes $23.4 billion 4
GCB Income from Continuing Operations Before Taxes $7.6 billion
Expense Management Citigroup Efficiency Ratio 57.4% 4
GCB Efficiency Ratio 55.0%
Use of Capital Citigroup Return on Tangible Common Equity 10.9% 4
GCB Return on Tangible Common Equity 16.4%
Citigroup Return on Assets 0.93% 4
GCB Return on Assets 1.36%
Risk GCB Risk Appetite Ratio 173% 2
GCB Risk Appetite Surplus $3.46 billion

QUALITATIVE SCORECARD
Qualitative Goal Result Highlights Rating(2)

Protect and enhance
our reputation

     
Control metrics generally improved year-over-year across GCB, and many outstanding regulatory issues were resolved.
Led by Mr. Bird, GCB demonstrated improvement in key diversity metrics and ethical culture scores.
Mr. Bird demonstrated leadership in revising his organizational structure, and the changes are already resulting in improved business performance.
      3